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http://www.archive.org/details/banl<lawsbankactoOOhalsrich 


Bank  Laws 


Bank  Act  of  California. 
PubKc  Deposit  Acts  of  California. 
National  Bank  Act  as  Amended. 
Currency  Act  of  March  14,  1900. 
Additional  Circulation  Act. 
New  York  Savings  Bank  Law. 


COMPILED    BY 

' 

N. 

W. 

Halsey 

&  Company, 

Bankers 

SAN 

FRANCISCO 
1909 

Of  THi 


COPYRIGHTED  1909 

N.   W.    HALSEY   &   COMPANY 

BANKERS 

424  CAUFORNIA  STREET 
San  Frandico,  California 


Bolte  &  Braden  Company 

'Prinien 

San  Francisco,  California 

1909 


Pref 


rerace 


The  purpose  of  this  volume  is  to  give  in  compact  and  conven- 
ient form  the  Statutes,  both  National  and  State,  which  affect  the 
bond  holdings  of  California  banks.  We  therefore  present  the 
Bank  Act,  passed  at  the  1 909  Session  of  the  California  Legislature, 
which  applies  to  Commercial  Banks,  Savings  Banks  and  Trust  Com- 
panies doing  business  in  the  State,  and  the  National  Bank  Act,  as 
amended  to  date,  which  governs  the  operations  of  National  Banks. 
In  order  to  add  to  the  reference  value  of  the  book,  we  have  care- 
fully annotated  these  Statutes  and  have  had  the  parts  of  the  law 
referring  specifically  to  bonds  printed  in  black-faced  type. 

In  addition  to  these  two  fundamental  Statutes,  we  include  the 
slate  laws  governing  the  deposit  of  public  moneys  in  California 
Banks  and  the  so-called  National  Emergency  Currency  Law,  passed 
by  the  sixtieth  Congress.  The  effect  of  the  two  latter  laws  has 
unquestionably  been  to  materially  add  to  the  value  of  Public  Bonds, 
State  and  Municipal,  as  a  reserve  holding  for  Banks.  A  Congres- 
sional Commission  has  been  engaged  for  several  months  in  the 
preparation  of  a  bill  aimed  to  establish  the  banking  and  currency 
system  of  the  country  on  a  more  scientific  and  permanently  satis- 
factory basis.  It  is  therefore  improbable  that  the  Emergency  Cur- 
rency Law,  in  its  present  form,  will  remain  permanently  on  the 
Statute  Books.  It  is  believed,  however,  that  the  principle  of  the 
Public  Deposit  Laws  in  California  is  sound  and  that  these  laws, 
permitting  the  deposit  of  Public  Moneys  in  banks  against  the  pledge 
of  Public  Bonds,  will  remain  a  part  of  the  permanent  policy  of  the 
State. 

We  also  give  an  extract  from  the  New  York  Savings  Bank 
Law,  defining  the  character  of  bonds  which  may  be  purchased  and 
held  by  the  Savings  Banks  in  that  State,  which  operate  exclusively 


181444 


on  a  mutual  basis.  Our  reason  for  including  this  extract  is  twofold: 
In  the  first  place,  the  New  York  Savings  Bank  Law  is  generally 
recognized  as  a  model  of  its  kind,  particularly  with  reference  to  its 
limitations  on  bonds  legal  for  trust  fund  investment,  and  it  is  there- 
fore reasonable  to  expect  a  development  of  the  California  Savings 
Bank  Law  along  the  lines  established  by  the  New  York  Statute  as 
the  development  of  the  State  justifies  the  adoption  of  Eastern  stand- 
ards. In  the  second  place,  the  prestige  and  additional  market 
standing  attaching  to  a  bond  which  satisfies  the  limitations  of  the 
New  York  Savings  Bank  Law  is  such  as  to  make  the  question  as  to 
whether  or  not  securities  conform  to  this  law  of  interest  to  bankers 
in  other  States. 

This  compilation  has  been  made  by  our  Statistical  Department, 
which  aims  to  keep  on  file,  available  for  the  inspection  of  bankers 
and  other  investors,  complete  official  data  relative  to  banking  and 
investment  matters,  including  information  relative  to  the  regulations 
of  the  National  Treasury  Department,  the  State  Treasurer's  office, 
and  the  Banking  Department  of  California,  together  with  copies  of 
all  forms  incident  to  dealing  with  these  offices;  also  official  statistics 
to  the  property  and  earnings  of  railroad  and  other  quasi-public  cor- 
porations, the  assessed  valuation  and  other  essential  particulars  relative 

to  municipal  securities. 

N.  W.  Halsey  &  Company. 

March  22.  1909. 


Contents 


Bank  Act  of  California 9 

Public  Deposit  Acts  of  California 57 

National  Bank  Act  as   Amended 65 

Currency  Act  of  March  14,  1900 151 

Additional  Circulation  Act 161 

New  York  Savings  Bank  Law 1 75 

General  Index 183 


Bank  Ad  of  California. 


An  Act  to  Define  and  Regulate 
THE  Business  of  Banking. 

The  people  of  the  State  of  California,  represented  in  senate  and 
assembly,  do  enact  as  follows: 

Article  I. 
GENERAL  PROVISIONS. 

Section  1.     This  act  shall  be  known  as  the  "Bank  Act,"  and    Title  of  act. 
shall  be  applicable  to  all  corporations  and  individuals  specified  in 
the  next  section. 

Sec.  2.     The  word  "bank"  as  used  in  this  act  includes  every   Definition  of 
person,  firm,  company,  copartnership  or  corporation  which  conducts    "bank" 
the  business  of  receiving  money  on  deposit.     Banks  are  divided  into 
the  following  classes: 

(a)  Savings  banks;  Kinds  of  banks. 

(b)  Commercial  banks;  and 

(c)  Trust  companies. 

Sec.   3.     Corporations  may  be  formed  under  the  laws  of  this   Formation  of 
state  to  conduct,  as  provided  in  this  act,  and  not  otherwise,  any  one    ^an^s. 
or  all  of  the  businesses  mentioned  in  divisions  a,  b  and  c  of  section 
2,  of  this  act. 

Sec.  4.  The  term  "savings  bank,"  when  used  in  this  act,  means  Savings  banks. 
a  bank  organized  for  the  purpose  of  accumulating  and  loaning  the 
funds  of  its  members,  stockholders,  and  depositors,  and  which  may 
loan  and  invest  the  funds  thereof,  receive  deposits  of  money;  loan, 
invest  and  collect  the  same  with  interest;  and  may  repay  depositors 
with  or  without  interest,  and  having  power  to  invest  said  funds 
in  such  property,  securities  and  obligations  as  may  be  prescribed 
by  this  act ;  and  to  declare  and  pay  dividends  on  its  general  deposits, 
and  a  stipulated  rate  of  interest  on  deposits  made  for  a  stated  period 
or  upon  special  terms. 


10 


N.    W.    HALSEY    &   CO. 


Commercial  Sec.  5.  The  term  "commercial  bank,"  when  used  in  this  act, 
banks,  means  any  bank  authorized  by  law  to  receive  deposits  of  money, 
deal  in  commercial  paper  or  to  make  loans  thereon,  and  to  lend 
money  on  real  or  personal  property,  and  to  discount  bills,  notes,  or 
other  commercial  paper,  and  to  buy  and  sell  securities,  gold  and 
silver  bullion,  or  foreign  coins  or  bills  of  exchange. 

Yrust        Sec.   6.     The  term   "trust  company,"  when  used  in   this   act, 
companies,    means  any  company  which  is  incorporated  for  the  purpose  of  con- 
ducting the  business  of  acting  as  executor,  administrator,  guardian  of 
estates,  assignee,  receiver,  depositary,  or  trustee. 

Foreign  Sec.  7.  No  foreign  corporation  shall  transact  a  banking  busi- 
corporations.  ness  in  this  state  without  first  complying  with  all  the  requirements  of 
the  laws  of  this  state  relative  to  banks  as  defined  in  this  act,  and 
without  havmg  the  capital  paid  up  in  this  state  as  required  by  this 
act.  And  no  such  foreign  corporation  shall  transact  any  banking 
business  in  this  state  until  it  has  executed  and  filed  with  the  superin- 
tendent of  banks  a  written  instrument  appointing  such  superintendent, 
or  his  successor  in  office,  its  true  and  lawful  attorney,  upon  whom  all 
process  in  any  action  or  proceeding  by  any  resident  of  the  state 
against  it  may  be  served,  with  the  same  effect  as  if  such  corporation 
was  formed  under  the  laws  of  this  state  and  had  been  law- 
fully served  with  process  therein.  Service  in  favor  of  a  resident  of 
this  state  upon  such  attorney  shall  be  deemed  personal  service  on 
such  corporation.  The  superintendent  of  banks  shall  forthwith  for- 
ward by  mail  a  copy  of  every  process  served  upon  him  under  the 
provision  of  this  section,  postage  prepaid,  and  directed  to  the  secre- 
tary of  such  corporation,  at  its  last  known  post  office  address.  For 
each  copy  of  process,  the  superintendent  of  banks  shall  collect  the 
sum  of  two  dollars,  which  shall  be  paid  by  the  plaintiff  or  moving 
party  at  the  time  of  such  service,  to  be  recovered  by  him  as  part  of 
.  *  his  taxable  costs  if  he  succeed  in  the  suit  or  proceeding. 

Filing  articles  of  ^EC.  8.  Every  corporation,  at  the  time  it  applies  for  a  certificate 
incorporation  to  do  a  banking  business,  must  file  with  the  superintendent  of  banks 

and  amendments,  a  certified  copy  of  its  articles  of  incorporation,  or  of  the  statute 
chartering  such  corporation,  also  all  instruments  amending  or  altering 
such  articles  of  incorporation  or  charter.  Thereafter  all  amendments 
and  certificates  shall  hkewise  be  so  filed  before  such  instruments  take 


BANK   ACT    OF   CALIFORNIA 11 

effect.     In  like  manner  all  copartnerships  shall  file  certified  copies  of 
their  articles  of  copartnership  and  all  amendments  thereto. 

Sec.  9.  No  bank  in  this  state,  or  any  officer  or  director  thereof.  Branch  banks. 
shall  hereafter  open  or  keep  an  office  other  than  its  principal  place  of 
business,  without  first  having  obtained  the  written  approval  of  the 
superintendent  of  banks  to  the  opening  of  such  branch  office,  which 
written  approval  may  be  given  or  withheld  in  his  discretion,  and 
shall  not  be  given  by  him  until  he  has  ascertained  to  his  satisfaction 
that  the  public  convenience  and  advantage  will  be  promoted  by  the 
opening  of  such  branch  office;  and,  provided  further,  that  no  bank 
or  any  officer  or  director  thereof,  shall  open  or  maintain  such  branch 
unless  the  capital  of  such  bank,  actually  paid  in  cash,  shall  exceed 
the  amount  required  by  this  act  by  the  sum  of  twenty-five  thousand 
dollars  for  each  branch  office  opened  and  maintained.  Every  bank, 
and  every  such  officer  or  director  violating  the  provisions  of  this  sec- 
tion shall  be  guilty  of  a  misdemeanor. 

Sec.  1 0.  No  person  shall  be  eligible  for  election  as  a  director  EUgihilii^  of 
of  a  bank  unless  he  is  a  stockholder  of  the  bank,  owning,  in  his  own  directors. 
right,  shares  thereof  of  the  actual  market  value  of  at  least  five  hun- 
dred dollars;  and  every  person  elected  to  be  director  who,  after 
such  election,  shall  cease  to  be  the  owner  in  his  own  right  of  the 
amount  of  stock  aforesaid,  shall  then  cease  to  be  a  director  of  the 
bank,  and  his  office  shall  then  become  vacant.  If  a  bank  be 
organized  without  capital  stock,  no  person  shall  be  eligible  as  a 
director  thereof  unless  he  .•is  both  a  member  and  a  depositor  of  such 
bank. 

Sec.  1 1 .  Each  director  of  a  bank,  when  appointed  or  elected.  Directors*  oath. 
shall  take  an  oath  that  he  will,  so  far  as  the  duty  devolves  on  him, 
diligently  and  honestly  administer  the  affairs  of  such  bank,  and  will 
not  knowingly  violate  or  wilfully  permit  to  be  violated  any  of  the 
provisions  of  law  applicable  to  such  bank,  and  that  he  is  the  owner 
in  good  faith  and  in  his  own  right  of  the  shares  of  stock  of  the 
actual  market  value  required  by  section  1 0  of  this  act,  subscribed  by 
him  or  standing  in  his  name  on  the  books  of  the  bank,  and  that  the 
same  is  not  hypothecated  or  in  any  way  pledged  as  security  for  any 
loan  or  debt;  and,  in  case  of  re-election  or  re-appointment,  that  such 


12  N.    W.    HALSEY    &   CO. 

stock  was  not  hypothecated  or  in  any  way  pledged  as  security  for 
any  loan  or  debt  during  his  previous  term.  Such  oath  shall  be 
subscribed  by  the  director  making  it,  and  certified  by  the  officer 
before  whom  it  is  taken;  and  shall  be  immediately  transmitted  to 
the  superintendent  of  banks,  and  filed  and  preserved  in  his  office. 

Use  of  words       Sec.  12.      No  person,  firm,  company,  co-partnership  or  corpora- 

indicating  lion  not  subject  to  the  supervision  of  the  superintendent  of  banks, 

performance  of  gjjj  j^^j  required  to  report  to  him  by  the  provisions  of  this  act,  shall 

banking  business.        ,  r  a:        •  i»li  l  ll- 

•■  make  use  or  any  omce  sign,   at  the  place  wriere  sucii   business  is 

transacted,  having  thereon  any  artificial  or  corporate  name,  or  other 
words  indicating  that  such  place  or  office  is  the  place  or  office  of  a 
bank,  or  that  deposits  are  received  there  or  payments  made  on  check, 
or  any  other  form  of  banking  business  transacted,  nor  shall  such 
person  or  persons,  firm,  company,  co-partnership  or  corporation  make 
use  of  or  circulate  any  letter  heads,  billheads,  blank  notes,  blank 
receipts,  certificates  or  circulars,  or  any  written  or  printed,  or  partly 
written  and  partly  printed,  paper  whatever,  having  thereon  any  arti- 
ficial or  corporate  name  or  other  word  or  words  indicating  that  such 
business  is  the  business  of  a  bank,  savings  bank  or  trust  company. 
Every  person,  firm,  company,  co-partnership  or  officer  of  a  corpora- 
tion violating  the  provisions  of  this  section  shall  be  guilty  of  a 
misdemeanor. 

Private  hanliers.  Sec.  1 3.  Every  person  or  number  of  persons,  not  being  incorpo- 
rated, engaged  in  the  business  of  banking  or  publicly  receiving  money 
on  deposits,  must  conduct  such  business  under  a  name  which  shows 
the  true  name  of  all  persons  engaged  therein,  unless  such  person  or 
persons  have  complied  with  the  provisions  of  article  7,  of  chapter  II, 
of  title  1 0,  of  part  IV  of  division  3  of  the  Civil  Code. 

Advertising  Sec.  14.  No  bank,  or  any  officer  thereof,  shall  advertise  in  any 
statement  of  manner,  or  publish  any  statement  of  the  capital  authorized  or  sub- 
capitaL.  scribed,  unless  it  or  he  advertise  and  publish,  in  connection  therewith, 
the  amount  of  capital  actually  paid  up.  Any  bank,  or  any  officer 
thereof,  advertising  in  any  manner,  or  publishing  any  statement  of 
such  capital,  authorized  or  subscribed,  without  a  statement  in  connec- 
tion therewith  of  the  capital  actually  paid  up,  shall  be  guilty  of  a 
misdemeanor. 


BANK   ACT   OF   CALIFORNIA  13 


Sec.  15.  The  president  or  managing  officer  of  every  bank  must.  Report  of 
within  fifteen  days  after  the  first  day  of  January  of  every  odd  num-  deceased  or 
bered  year,  return  to  the  superintendent  of  banks  a  sworn  statement  .  ■. 
showing  the  names  of  depositors  known  to  be  dead,  or  who  have  not 
made  further  deposits,  or  withdrawn  any  moneys  during  the  preced- 
ing ten  years.  Such  statements  shall  show  the  amount  of  the  account, 
the  depositor's  last  known  place  of  residence  or  post  office  address, 
and  the  fact  of  death,  if  known  to  such  president  or  managing 
officer.  Such  president  or  managing  officer  must  give  notice  of  these 
deposits  in  one  or  more  newspapers  published  in  or  nearest  to  the 
town  or  city  where  such  bank  has  its  principal  place  of  business,  at 
least  once  a  week  for  four  consecutive  weeks,  the  cost  of  such  publi- 
cation to  be  paid  pro  rata  out  of  such  unclaimed  deposits.  This 
section  does  not  apply  to  any  deposit  made  by  or  in  the  name  of  a 
person  known  to  the  president  or  managing  officer  to  be  living,  or 
which,  with  the  accumulation  thereon,  is  less  than  fifty  dollars. 
The  superintendent  of  banks  must  incorporate  in  his  subsequent 
report  such  returns  made  to  him  as  provided  in  this  section.  Any 
president  or  managing  officer  of  any  bank  who  neglects  or  refuses  to 
make  the  sworn  statement  required  by  this  section  shall  be  guilty  of 
a  misdemeanor. 

Sec.   1 6.     When  any  deposit  with  a  bank  shall  be  made  by  or  Deposits  in  name 

in  the  name  of  any  married  woman  or  minor,  the  same  shall  be  held  '^^  ^  mamea 
,,  ....         iirrii-  irr         Woman  or  mmor. 

■tor  the  exclusive  right  and  benefit  or  such  depositor,  and  tree  trom 

the  control  or  lien  of  all  other  persons,  except  creditors,  and  shall 

be  paid,  together  with  the  dividends,  if  any,  and  interest,  if  any, 

thereon    to    the   person    in    whose    name    deposits    shall    have    been 

made,  and  the  receipt  or  acquittance  of  such  minor  shall  be  a  valid 

and  sufficient  release  and  discharge  for  such  deposit,   or  any  part 

thereof,  to  the  bank.     When  any  deposit  with  a  bank  shall  be  made 

by  any  person  in  trust  for  another,  and  no  other  or  further  notice  of  '"  trust. 

the  existence  and  terms  of  a  legal  and  valid  trust  shall  have  been 

given  in  writing  to  such  bank,   in   the  event  of  the  death  of  the 

trustee,  the  same  or  any  part  thereof,  together  with  the  dividends  or 

interest,  if  any,  thereon,  may  be  paid  to  the  person  for  whom  the 

deposit  was  made.     When  a  deposit  with  a  bank  shall  be  made  by 

any  person  in  the  names  of  such  depositor  and  another  person  or  Joint  accounts. 


14 N.    W.    HALSEY    &   CO. 

persons,  and  in  form  to  be  paid  to  either  or  the  survivor  or  survivors 
of  them,  such  deposit  thereupon,  and  any  additions  thereto  made  by 
either  of  such  persons  upon  the  making  thereof,  shall  become  the 
property  of  such  persons  as  joint  tenants,  and  the  same,  together 
with  ail  interest  thereon,  shall  be  held  for  the  exclusive  use  of  the 
persons  so  named,  and  may  be  paid  to  either  during  the  Hfetime  of 
all  or  any  or  to  the  survivor  or  survivors  after  the  death  of  one  or 
more  of  them,  and  such  payments  and  the  receipt  or  acquittance  of 
the  one  to  whom  such  payment  is  made  shall  be  a  valid  and  suffi- 
cient release  and  discharge  to  said  bank  for  all  payments  made  on 
account  of  such  deposit. 
Payment  of  The  surviving  husband  or  wife  of  any  deceased  person,  or,  if  no 
deposits  of  husband  or  wife  is  living,  then  the  children  of  such  decedent,  and  if 
deceased  persons  jjq  children  are  living,  then  the  father  or  mother  of  such  decedent, 
10.  ujj^y^  without  procuring  letters  of  administration,  collect  of  any  bank 
any  sum  which  said  deceased  may  have  left  on  deposit  in  such  bank 
at  the  time  of  his  or  her  death;  provided,  such  deposit  shall  not 
exceed  the  sum  of  five  hundred  dollars.  Any  bank,  upon  receiving 
an  affidavit  stating  that  said  depositor  is  dead,  and  that  affiant  is  the 
survivmg  husband  or  wife,  as  the  case  may  be,  or  stating  that 
decedent  left  no  husband  or  wife,  and  that  affiant  is,  or  affiants  are, 
the  children,  or  the  father  or  mother,  of  said  decedent,  and  that  the 
whole  amount  that  decedent  left  on  deposit  in  any  and  all  banks  of 
deposit  in  this  state  does  not  exceed  the  sum  of  five  hundred  dollars, 
may  pay  to  said  affiant  or  affiants  any  deposit  of  said  decedent,  if 
the  same  does  not  exceed  the  sum  of  five  hundred  dollars,  and  the 
receipt  of  such  affiant  is  sufficient  acquittance  therefor. 

Information  to  be       Sec.    1  7.     Every  bank  now  in  existence  or  hereafter  organized 

liept  on  file  for  ^\^q\\  jrgep  in  its  offices,  in  a  place  accessible  to  the  stockholders, 

s  oc/f  0    ers.  jgpQgjtQyg,  and  creditors  thereof,  and  for  their  use,  a  book  containing 

a  list  of  stockholders  in  such  corporation,  and  the  number  of  shares 

of  stock  held  by  each;  and  every  such  bank  shall  keep  posted  in  its 

Information  for  office,  m  a  conspicuous  place,  accessible  to  the  public  generally,  a 

the  public,  notice  signed  by  the  president  or  secretary,  showing: 

1.  The  names  of  the  directors  of  such  bank. 

2.  The  number  and  the  par  value  of  the  shares  of  stock  held  by 
each  director. 


BANK   ACT   OF   CALIFORNIA 


15 


The  entries  on  such  book  and  such  notice  shall  be  made  and 
posted  within  twenty-four  hours  after  any  transfer  of  stock,  and 
shall  be  prima  facie  evidence  against  each  director  and  stockholder 
of  the  number  of  shares  of  stock  held  by  each. 

Sec.    18.     Every  co-partnership  doing  a  banking  business  shall   Co-partnership. 
keep  in  its  oHice,  in  a  place  accessible  to  the  partners  and  depositors 
and  the  creditors  thereof,  a  list  of  the  partners  and  the  capital  paid 
into  the  co-partnership  of  each  partner. 

Sec.   19.     The  aggregate  of  paid  up  capital,  together  with  the    r?e/a/,'on  of 
surplus,  of  every  bank,  must  equal  ten  per  centum  of  its  deposit  paid-up  capital 
liabilities;  such  deposit  liabilities  shall  not  be  increased  when  such   to  deposit 
proportion  of  paid  up  capital  and  surplus  is  wanting,  and  in  no  event   tic^bilittes. 
shall  said  paid  up  capital  be  less  than  the  minimum  paid  up  capital 
provided  by  this  act.     And,  provided  also,  that  no  savings  bank 
shall  be  required  to  have  a  paid  up  capital  and  surplus  of  more  than 
one  million  dollars  or  if  organized  without  a  capital  stock,  a  reserve 
fund  of  more  than  one  million  dollars. 

Sec.  20.  Every  bank,  other  than  a  savings  bank,  shall  at  all  Lawful  monej; 
limes  have  on  hand,  in  lawful  money  of  the  United  States,  gold  and  reserve, 
silver  coin,  gold  certificates  or  silver  certificates,  an  amount  equal  to 
fifteen  per  centum  of  the  aggregate  amount  of  its  deposits,  exclusive 
of  state,  county  and  municipal  deposits.  The  amount  thus  to  be 
kept  on  hand  shall  be  called  its  lawful  money  reserve.  Three-fifths 
of  such  lawful  money  reserve  of  any  bank  other  than  a  savings  bank 
may  consist  of  moneys  on  deposit  subject  to  call  with  any  bank  or 
banks  other  than  a  savings  bank  in  this  state;  provided,  that  every 
bank  receiving  deposits  of  other  banks  shall  maintain  as  a 
lawful  money  reserve  at  least  twenty  per  centum  of  the  aggregate 
smount  of  its  deposits,  exclusive  of  state,  county  and  municipal 
deposits.  If  the  lawful  money  reserve  of  any  bank  shall  be  less 
than  the  amount  required  by  this  section,  such  bank  shall  not  increase 
its  liability  by  making  any  new  loans  or  discounts,  otherwise  than  by 
discounting  bills  of  exchange  payable  on  sight,  or  making  any 
dividends  from  profits  until  the  full  amount  of  its  lawful  money 
reserve  has  been  restored.  The  superintendent  of  banks  may  notify 
any  bank,  whose  lawful  money  reserve  shall  be  below  the  amount 


J_6 N.    W.    HALSEY    &   CO. 

herein  required,  to  make  good  such  reserve;  and,  if  it  shall  fail  for 
thirty  days  thereafter  to  make  good  such  reserve,  such  bank  shall  be 
deemed  insolvent  and  may  be  proceeded  against  under  the  provisions 
of  this  act. 

Dividends.  Sec.  21.  The  directors  of  banks  having  a  capital  stock  may, 
at  such  times  and  in  such  manner  as  the  by-laws  prescribe,  declare 
and  pay  dividends  to  depositors  and  stockholders  of  so  much  of  the 
profits  of  the  bank,  and  of  the  interest  arising  from  the  capital  and 
deposits,  as  may  be  appropriated  for  that  purpose  under  the  by-laws 
or  under  their  agreements  with  depositors,  but  every  such  bank  shall, 
before  the  declaration  of  such  dividend,  carry  at  least  one-tenth 
(1-10)  part  of  the  net  profits  of  the  stockholders  for  the  preceding 
half  year  to  its  surplus  or  reserve  fund  until  the  same  shall  amount  to 
twenty-five  per  centum  of  its  paid-up  capital  stock.  But  the  whole 
or  any  part  of  such  surplus  or  reserve  fund,  if  held  as  the  exclusive 
property  of  stockholders,  may  at  any  time  be  converted  into  paid-up 
capital  stock,  in  which  event  such  surplus  or  reserve  fund  shall  be 
restored  in  manner  as  above  provided  until  it  amounts  to  twenty-five 
per  centum  of  the  aggregate  paid-up  capital  stock.  A  larger  surplus 
or  reserve  fund  may  be  created,  and  nothing  herein  contained  shall 
be  construed  as  prohibitory  thereof.  The  capital  and  the  assets  of 
the  bank  are  a  security  to  depositors  and  stockholders,  depositors 
having  the  priority  of  security  over  the  stockholders,  but  the  by-laws 
may  provide  that  the  same  security  shall  extend  to  deposits  made  by 
stockholders. 

Department        Sec.  22.     Any  corporation  authorized  by  its  articles  of  incor- 
banl(s.    poration  so  to  do,  may  combine  the  business  of  a  commercial  bank 
and  savings  bank  and  trust  company,  or  any  or  all  of  them. 

Paid-up  capital  Sec.  23.  Every  bank  doing  a  departmental  business,  shall  have 
required,  paid  up  in  cash  a  capital  stock  of  not  less  than  twenty-five  thousand 
dollars  if  it  transacts  both  a  commercial  and  savings  business;  and 
paid  up  in  cash  a  capital  stock  of  not  less  than  two  hundred  twenty- 
five  thousand  dollars  if  it  transacts  both  a  commercial  and  trust  busi- 
ness; and  paid  up  in  cash  a  capital  stock  of  not  less  than  two  hun- 
dred twenty-five  thousand  dollars  if  it  transacts  both  a  savings  and 
trust  business;  and  paid  up  in  cash  a  capital  stock  of  not  less  than 


BANK   ACT   OF   CALIFORNIA 17 

two  hundred  twenty-five  thousand  dollars  if  it  transacts  a  com- 
mercial, savings  and  trust  business.  Such  capital  stock  shall  be 
increased  from  time  to  time  in  the  same  manner  and  to  the  same 
extent  as  provided  for  in  section  nineteen  of  this  act. 

Sec.  24.     Every  bank,  before  it  commences  to  do  business  or  Certificate   of   the 
before  it  opens  a  new  department  and  commences  to  transact  busi-  Superintendeni 
ness  in  or  under  such  new  department,  shall  obtain  the  certificate  of  ^'  banlis. 
the  superintendent  of  banks  for  the  opening  of  each  of  the  depart- 
ments specified.     Each  certificate  herein  provided  for  shall  be  given 
when  the  superintendent  shall,  by  the  examination  required  by  this 
act,  have  satisfied  himself  that  the  proper  amount  of  cash  has  been 
paid  in  as  capital  and  the  provisions  of  this  act  complied  with.     The 
applicant  shall  pay  for  such  certificate  a  fee  of  fifty  dollars. 

Sec.   25.      Every  bank  shall   maintain   for  each   department   a  Lawful  money 

lawful  money  reserve  equal  in  amount  to  that  required  by  this  act  ^^^^^^  required 

for  the  respective  business  conducted,  and  shall  keep  separate  and    , 
v-iifi  r  ,  rir  department. 

distinct  the  lawrul  money  reserve  or  any  department  from  that  of 

any   other  department;    and   all   deposits  made   with   other   banks,  ^^'a/ions  of 

whether   temporary  or  otherwise,   shall  be  assets  of   the  respective     ^'^^'^  ments. 

departments  by  which  they  were  made,  and  shall  be  so  carried  on 

the  books  of  such  other  banks,  and  shall  be  repaid  only  upon  the 

order  of  the  department  to  whose  credit  they  stand. 

No  department  shall  receive  deposits  of  any  other  department  of  Deposits. 

the  same  corporation;    provided,  however,  that  any  bank  having 

departments  shall  have  the  right  to  sell  and  transfer  any 

bonds,   securities  or  loans   from  one  department  to   another  upon 

receipt  of  the  actual  value  thereof,  if  such  bonds,  securities  or  loans 

are  a  legal  investment  for  the  department  purchasing  the 

same  under  the  provisions  of  this  act. 

Sec.  26.     Every  bank  having  different  departments  shall  keep  Separate  books. 
separate  books  of  account  for  each  department  of  its  business,  and 
shall  be  governed  as  to  all  deposits,  reserves,  investments  and  trans- 
actions  relating   to   each   department  by   the   provisions   in   this   act 
specifically  provided  for  the  respective  kind  of  business. 

It  shall  keep  all  investments  relating  to  the  savings  department  Separate 
entirely  separate  and  apart  from  the  investments  of  its  other  depart-  '"^es/men/s. 
ment  or  departments. 


]S N.    W.    HALSEY    &   CO. 

Separate,  cash       Every  bank  shall  conduct  the  business  of  all  its  departments  in 

securities  and  ^j^g   building,    or   in    adjoining   buildings,    and    shall    keep   entirely 

separate  and  apart  in  each  department  the  cash,  securities  and  prop- 

Assets  of  each  erty  belonging  to  such  department,  and  shall  not  mingle  the  cash, 

department,  securities  and  property  of  one  department  with  that  of  another. 

Sec.  27.  All  money  belonging  to  each  department,  whether 
cash  on  hand  or  with  other  banks,  and  the  investments  made,  shall 
be  held  solely  for  the  repayment  of  the  depositors  in  said  department, 
until  all  depositors  of  such  department  shall  have  been  paid,  and  the 
overplus  then  remaining  shall  be  applied  to  the  other  liabilities  of 
such  bank. 


Kind  of  banking       Sec.  28.      Every  individual,  firm  or  corporation  doing  a  banking 

business  business  in  this  state  must,  on  all  its  window-signs  and  in  advertising, 

iransac  e     mus    ^^j  ^^  letterheads  and  other  stationery  on  which  its  business  is  trans- 
be  advertised.  .  .  ,  ..      •      „  .f  .  ,  ... 

acted,  use  the  word     savmgs     ir  it  conducts  a  savmgs  busmess,  or 

the  word  "trust"  if  it  conducts  a  trust  department,  and  the  word 

"commercial"  if  it  conducts  a  commercial  department. 

Steps  necessary  to       Sec.  29.      Every  corporation  heretofore  created  under  the  laws 

convert  a  banking  ©f  this  state,  doing  a  banking  business  therein,  and  which  has  no 

. ,  (corporation  (.^pitaj  stock,   may  elect  to  have  a  capital  stock,   and  may  issue 
"Without    capital         ...  r  i      i       r        •       i 

stoch  into  a  stoch  certificates  or  stock   therefor,   in   the   same   manner   as   corporations 

corporation,  formed  under  the  provisions  of  part  IV,  title  1,  chapter  I,  article  I, 
of  the  Civil  Code,  relating  to  the  formation  of  corporations;  pro- 
vided, that  no  such  corporation  shall  use  or  convert  any  moneys  or 
funds  theretofore  belonging  to  it,  or  under  its  control,  into  capital 
stock;  but  such  funds  or  moneys  must  be  held  and  managed  only 
for  the  purposes  and  in  the  manner  for  which  they  were  created. 
Before  such  change  is  made,  a  majority  of  the  members  of  such 
corporation  present  at  a  meeting  called  for  the  purpose  of  consider- 
ing the  proposition  whether  it  is  best  to  have  a  capital  stock,  its 
amount,  and  the  number  of  shares  into  which  it  shall  be  divided, 
must  vote  in  favor  of  having  a  capital  stock,  fix  the  amount  thereof, 
and  the  number  of  shares  into  which  it  shall  be  divided.  Notice  of 
the  time  and  place  of  holding  such  meeting,  and  its  object,  must  be 
given  by  the  president  of  such  corporation  by  mailing  notice  of  such 
meeting  to  each  member  of  such  corporation  at  his  last  known  post 


BANK   ACT   OF   CALIFORNIA  19 

office  address  at  least  ten  days  prior  to  the  day  fixed  for  such  meet- 
ing, and  by  publication  in  some  newspaper  printed  and  published  in 
the  county,  or  city  and  county,  in  which  the  principal  place  of  busi- 
ness of  the  corporation  is  situated,  at  least  once  a  week  for  three 
successive  weeks  prior  to  the  holding  of  the  meeting.  A  copy  of 
the  proceedings  of  this  meeting,  giving  the  number  of  persons  present, 
the  votes  taken,  the  notice  calling  the  meeting,  the  proof  of  its  publi- 
cation, the  amount  of  capital  actually  subscribed,  and  by  whom,  all 
duly  certified  by  the  president  and  secretary  of  the  corporation, 
must  be  filed  in  the  office  of  the  secretary  of  state  and  clerk  of  the 
county  where  the  articles  of  incorporation  are  filed.  Thereafter 
such  corporation  is  possessed  of  all  the  rights  and  powers,  and  is 
subject  to  all  the  obligations,  restrictions,  and  limitations,  as  if  it  had 
been  originally  created  with  a  capital  stock. 

Sec.   30.     Any  bank  may  conduct  a  safe  deposit  department.  Safe  deposit 
but  shall  not  invest  more  than  one-tenth  of  its  capital  and  surplus  in  department. 
such  safe  deposit  department 

Sec.  31.  Any  bank  may  sell  the  whole  or  any  portion  of  its  ^^/g  qj.  purchase 
assets  to  any  other  bank  which  may  purchase  its  assets  after  obtain-  of  assets  of  banks. 
ing  the  consent  of  the  stockholders  of  the  selling  and  of  the  purch- 
asing bank  holding  of  record  at  least  two-thirds  of  the  issued  capital 
stock  of  each  of  such  corporations;  such  consent  to  be  expressed 
either  in  writing  executed  and  acknowledged  by  such  stockholders 
and  attached  to  the  instrument  of  sale,  or  to  a  copy  thereof,  or  by 
vote  at  a  stockholders'  meeting  of  such  banks  called  for  that 
purpose. 

The  selling  and  purchasing  banks  may  for  such  purposes  enter  Agreement  of  sale 
into  an  agreement  of  sale  and  purchase,  which  agreement  shall  con-  and  purchase. 
tain  all  the  terms  and  conditions  connected  with  the  sale  and  pur- 
chase of  its  assets. 

Such  agreement  shall  contain  proper  provision  for  the  payment  of  Provisions  of 
liabilities  of  the  selling  bank,  and  in  this  particular  shall  be  subject  agreement. 
to  the  approval  of  the  superintendent  of  banks;   and  shall  not  be 
valid  until  such  approval  is  obtained.     Such  agreement  may  contain 
provisions  for  the  transfer  of  all  deposits  to  the  purchasing  bank,  sub- 
ject, however,  to  the  right  of  every  depositor  of  the  selling  bank  to 


20  N.    W.    HALSEY    &   CO. 

withdraw  his  deposit  in  full  on  demand  after  such  transfer,  irrespec- 
tive of  the  terms  under  which  it  was  deposited  with  the  selling  bank. 

Trusl  funds  must  Sec.  32.  Any  bank  receiving  trust  funds  in  accordance  with  the 
be  Itept  separate,  provisions  of  this  act  relating  to  trust  companies  must  not  mingle 
such  trust  funds  with  the  other  assets  of  the  corporation,  and  such 
funds  shall  not  be  carried  or  counted  as  any  part  of  the  lawful  reserve 
provided  for  in  this  act.  The  officers  of  any  bank  who  knowingly 
violate  or  consent  to  the  violation  of  this  provision  shall  be  guilty  of 
a  felony. 

No  official  or        Sec.  33.      No  officer  or  employee  of  any  bank  shall,  directly  or 
empLo^ee  oj  a    indirectly,  for  himself  or  as  the  partner  or  agent  of  others,  borrow 
I  r    any  of  the  deposits  or  other  funds  of  such  bank,  nor  shall  he  nor 

that  bank'  ^^^  director  become  an  endorser  or  surety  for  loans  to  others  nor  in 
any  manner  be  obligor  for  moneys  borrowed  or  loaned  by  such 
bank.  The  office  of  any  officer  or  employee  who  acts  in  contraven- 
tion of  the  provisions  of  this  section  shall  immediately  become  vacant, 
and  he  shall  be  guilty  of  a  misdemeanor. 

I\o  oan/p  ma)}  Sec.  34.      No  bank  shall  purchase  or  invest  its  capital  or  money 

inves    in  or   oan  ^^  jj^  depositors,  or  any  part  of  either,   in  the  shares  of  its  own 

on  snares  of  its  •    i         i             i         •           •    i         i                    r  •      i        • 

oiun  cabiial  stock  *^^P'*''^  stock;  nor  loan  its  capital  or  the  money  or  its  depositors,  or 

any  part  of  either,  on  the  shares  of  its  own  capital  stock,  unless  such 
purchase  or  loan  shall  be  necessary  to  prevent  loss  on  debts  pre- 
viously contracted  in  good  faith. 

Stock  thus  purchased  or  carried  shall,  within  six  months  from  the 
time  of  its  purchase,  be  sold  or  disposed  of  at  public  or  private  sale. 

The  officers  of  any  bank  who  knowingly  violate  or  consent  to  the 
violation  of  this  provision  shall  be  guilty  of  a  felony. 

Transactions        Sec.   35.      No  director,   or  officer,   or  employee,   or  controlling 

between  a  banti    stockholder  of  any  bank  shall,  directly  or  indirectly,  for  himself  or 

/r  '    as  the  partner  or  agent  of  others,  sell  or  transfer,  or  cause  to  be  sold 

officers  or 

emploVees.  °^  transferred  to  the  bank  of  which  he  is  a  director,  officer, 
employee,  or  controlling  stockholder,  any  mortgage  on  real  estate  or 
contract  arising  from  the  sale  of  real  estate  made  by  any  corporation 
or  syndicate  in  which  such  director  or  officer,  or  employee,  or  con- 
trolling stockholder  is  personally  or  financially  interested,  without  the 
consent  in  writing  of  the  superintendent  of  banks. 


BANK   ACT   OF   CALIFORNIA  21 

Any  director,  or  officer,  or  employee,  or  controlling  stockholder 
of  any  bank  who  knowingly  violates  or  consents  to  the  violation  of 
this  provision  shall  be  deemed  guilty  of  a  felony. 

Sec.  36.     No  bank  receiving  deposits  of  money  shall   Limitation  of 
purchase,  agree  to  purchase,  underwrite  or  guarantee  any   i>ond  underwriting 
bond  issue  in  excess  of  five  per  centum  of  its  assets,  except   °^  giiarantee. 
bonds  of  the  United  States,  of  the  State  of  California,  of 
the  cities,  cities  and  counties,  counties  or  school  districts 
of  this  state. 

Sec.  37.  No  bank  shall  purchase,  or  invest  its  capital  or  money  Investment  in 
of  its  depositors,  or  any  part  of  either,  in  shares  of  corporations,  stocks  prohibited. 
unless  such  purchase  shall  be  necessary  to  prevent  loss  on  debts 
previously  contracted  in  good  faith,  and  stock  thus  purchased  or 
carried  shall,  within  six  months  from  the  time  of  its  purchase,  be 
sold  or  disposed  of  at  public  or  private  sale,  unless  permission  to 
hold  said  stock  for  a  longer  period  shall  be  obtained  from  the 
superintendent  of  banks. 

The  officers  of  any  bank  who  knowingly  violate  or  consent  to  the 
violation  of  this  provision  shall  be  deemed  guilty  of  a  felony. 

Sec.   38.     A  director,  officer,  agent  or  employee  of  any  bank    False  entries. 
who. 

First — Knowingly  receives  or  possesses  himself  of  any  of  its  prop- 
erty otherwise  than  in  payment  for  a  just  demand,  and  with  intent 
to  defraud,  omits  to  make  or  to  cause  or  direct  to  be  made  a  full 
and  true  entry  thereof  in  its  books  and  accounts;  or. 

Second — Concurs  in  omitting  to  make  any  material  entry  thereof; 
or. 

Third — Knowingly  concurs  in  making  or  publishing  any  written 
report,  exhibit  or  statement  of  its  affairs  or  pecuniary  condition  con- 
taining any  material  statement  which  is  false;  or. 

Fourth — Having  the  custody  or  control  of  its  books,  wilfully 
refuses  or  neglects  to  make  any  proper  entry  in  the  books  of  such 
corporation  as  required  by  law,  or  to  exhibit  or  allow  the  same  to 
be  inspected  and  extracts  to  be  taken  therefrom  by  the  superintendent 
of  banks,  his  chief  deputy  or  any  of  his  examiners,  shall  be  guilty 
cf  a  felony. 


22  N.    W.    HALSEY    &   CO. 


Overdrafts   fep  Sec.  39.     Any  officer,  director,  agent,  teller,  clerk  or  employee 

persons  connected  ^f  any  bank  who  either. 

jvith  bank  i—         i^        .     i 

prohibited.  ^^^^^ — Knowingly  overdraws  his   account  with  such  bank,   and 

thereby  obtains  the  money,  notes  or  funds  of  any  such  bank;  and. 

Commissions  to       Second — ^Asks  or  receives  or  consents  or  agrees  to  receive  any 
persons  connected  commissions,  emoluments,  gratuity  or  reward,  or  any  money,  prop- 

^  ,.,."?  erty  or  thing  of  value  or  of  personal  advantage,   for  procuring  or 
prohibited.        ,         .      ^  ,  ^  .  , 

endeavormg  to  procure  ror  any  person,  hrm  or  corporation  any  loan 

from,  or  the  purchase  or  discount  of  any  paper,  note,  draft,  check 

or  bill  of  exchange,  by  such  bank,  or  for  permitting  any  person,  firm 

or  corporation  to  overdraw  any  account  with  such  bank,  is  guilty  of 

a  felony. 

/        Stockholders'       Sec.  40.      No  bank  mentioned  in  this  act  shall  make  any  con- 

liabiht^  cannot  tract  with  any  of  its  depositors  whereby  the  stockholders'  liability 

li'flivea.  provided   for  by   the   constitution   of   this   state   is   in   any   manner 

waived,  and  if  any  such  contract  shall  be  so  made,  such  contract 

shall  be  void. 

Purchase  of       Sec.  4 1 .     No  director,  officer,  agent,  or  servant  of  any  bank 
obligatiarns  of  ^hall,  directly  or  indirectly,  for  his  own  personal  benefit,  purchase  or 
baniis    p  |tjg  interested  in  the  purchase  of  any  of  the  obligations  of  said  bank 
'  f or  a  less  sum  than  shall  appear  upon  the  face  thereof. 

Purchase  of       Sec.  42.      No  director,  officer,  agent,  or  servant  of  any  bank 
assets  of  bank  shall,  directly  or  indirectly,  for  his  own  personal  benefit,  purchase 
oy  directors,  etc.  ^^  ^^  interested  in  the  purchase  of  any  of  the  assets  of  said  bank, 
for  a  less  sum  than  the  current  market  value  thereof.     Every  per- 
son violating  the  provisions  of  this  subdivision  shall  be  guilty  of  a 
misdemeanor. 

Deposits  with       Sec.  43.     No  bank  shall  deposit  any  of  its  funds  with  any  other 

other  banks  rnust  bank,  unless  such  other  bank  has  been  designated  as  a  depositary  for 

,     ^,P"  ,  ^"^'^^  ,  its  funds  by  the  vote  of  a  majority  of  the  directors  or  trustees  of  the 
bjj  disinterested  ,,,.,,.  i    •         r    i  r  v 

directors    "^"^  making  the  deposit,  exclusive  ot  the  vote  ot  any  director  or 

trustee  who  is  an  officer,  director  or  trustee  of  the  depositary  so 

designated. 
Loans  secured 

b^  stocks  of       Sec.  44.      No  bank  shall  hereafter  make  a  loan  secured  by  the 

other  banks,  stock  of  another  bank,  if  by  making  such  loan  the  total  stock  of  such 


BANK   ACT   OF   CALIFORNIA  23 

other  bank  held  by  such  loaning  bank  as  collateral  will  exceed  in 
the  aggregate  ten  per  centum  of  the  capital  stock  of  such  other  bank; 
provided  that  no  loan  upon  the  capital  stock  of  any  bank  shall  be 
made  unless  such  bank  has  been  in  existence  for  two  or  more  years 
and  has  earned  and  paid  a  dividend  upon  its  capital  stock. 

Sec.  45.     Interest  unpaid,  although  due  or  accrued,  on  debts  Unpaid  interest. 
owing  to  any  bank,  shall  not  be  included  in  calculation  of  its  profits 
previous  to  a  dividend. 

Sec.  46.     No  bank  shall  invest  or  loan  more  than  five  j  ;~,:yQ*;on  q/ 
per  centum  of  its  assets  in  any  one  bond  issue,  except  jnvesi/nenf  in 
bonds  of  the  United  States,  of  the  State  of  California,  of  bonds. 
the  counties,  cities  and  counties,  cities  or  school  districts 
of  this  state. 

Sec.  47.      No  bank  shall  make  any  loan  on  real  esate  except  it  J^oans  on  real 
be  a  first  lien,  but  this  provision  shall  not  prevent  the  acceptance  of  estate  must  be 
a  second  lien  to  secure  the  payment  of  a  debt  previously  contracted  first  lien. 
in  good  faith. 

Sec.  48.     Any  national  bank  of  this  state  receiving  the  deposits  Examinations  of 
of  banks  organized  and  conducting  business  under  this  act,  must,  at  national  banks 
the  request  of  the  superintendent  of  banks,  submit  to  an  examination  receiving 
by  him,  or  his  duly  appointed  examiners,  should  the  superintendent  ^^P°^^^  ^f 
of  banks  in  his  discretion  deem  it  necessary  or  desirable  that  such 
examination  be  made;  and  the  expense  of  such  examination  shall  be 
paid  by  such  national  bank;  and  if  any  such  national  bank  shall 
refuse  to  permit  such  examination  to  be  made  by  the  superintendent 
of  banks,  then  the  superintendent  of  banks  shall  notify  in  writing  any 
and  all  banks  depositing  its  funds  with  such  national  bank,  to  with- 
draw its  deposits  therefrom,  and  such  bank  shall  comply  with  such 
order,  and  failure  so  to  do  shall  be  a  misdemeanor. 

Sec.  49.      It  shall  not  be  lawful  for  any  commercial  bank,  indi-  q„/^  "savines 

vidual  banker,  trust  company,  association,  firm,  stock  company,  or  banks"  ma}) 

corporation,  to  advertise  or  put  forth  a  sign  as  a  savings  bank,  either  solicit  or  receive 

directly  or  indirectly,  or  in  any  way  to  solicit  or  receive  deposits  as  savings  deposits. 
a  savings  bank,  except  in  the  case  of  savings  banks  or  banks  having 
a  savings  department,  subject  to  the  provisions  of  this  act. . 


24  N.    W.    HALSEY    &   CO. 

Posting  of       Sec.  50.     Every  bank  shall  post  in  a  conspicuous  place  in  its 

certificate,  banking  room  the  last  certificate  obtained  from  the  superintendent  of 

banks,  as  provided  for  in  section  127  of  this  act.     Every  bank  that 

fails   to  comply  with   the  provisions  of  this  section  is  guilty  of   a 

misdemeanor. 

Deposits  b})  Sec  51.  Any  court  having  appointed  and  having  jurisdiction 
court  officers  of  any  executor,  administrator,  guardian,  assignee,  receiver,  depos- 
or  trustees,  jtary  or  trustee,  upon  the  application  of  such  executor,  administrator, 
guardian,  assignee,  receiver,  depositary  or  trustee,  or  upon  the  appli- 
cation of  any  person  having  an  interest  in  the  estate  administered 
upon  by  such  officer  or  trustee,  after  notice  to  other  parties  in  interest 
as  the  court  may  direct,  and  after  a  hearing  upon  such  application, 
may  authorize  such  officer  or  trustee  to  deposit  any  money  then  in 
his  hands  as  such  officer  or  trustee  or  which  may  thereafter  come 
into  his  hands,  and  until  the  further  order  of  the  court,  in  any  bank 
organized  under  the  laws  of  the  State  of  California;  and  upon  such 
deposit  being  made,  the  officer  or  trustee  so  depositing  the  same  shall 
thereafter  and  while  such  moneys  remain  on  deposit  in  such  bank, 
be  relieved  and  discharged  from  all  liability  and  responsibility 
therefor,  and  the  bond  required  of  such  officer  or  trustee  given  upon 
his  appointment  shall  be  thereupon  by  said  court  reduced  to  such  an 
amount  as  the  court  may  deem  reasonable;  such  deposit  shall  be 
repaid  only  upon  the  orders  of  said  court,  and  shall  be  a  preferred 
claim  against  such  bank  and  be  paid  in  full  before  any  other 
depositor  of  such  bank  shall  have  been  paid. 


Article  II. 
SAVINGS    BANKS. 

Capital  stock.  ^^^'  ^^*  livery  savings  bank  must  have  actually  paid  in  a 
capital  stock  of  not  less  than  twenty-five  thousand  dollars,  or,  if 
organized  without  capital  stock,  a  reserve  fund  of  at  least  one  million 
dollars  and  until  said  sum  of  twenty-five  thousand  dollars,  or  said 
sum  of  one  million  dollars,  shall  be  actually  paid  in,  the  superin- 
tendent of  banks  shall  refuse  to  issue  the  certificate  required  by  this 
act;  provided  that  nothing  herein  shall  be  construed  to  affect  the 


BANK   ACT   OF   CALIFORNIA  25 


provisions  of  section  twenty-three  of  this  act  relative  to  the  capital    Real  and 

stock  required  of  banks  doing  a  departmental  business.  personal 

property)  Hfhich 
Sec.   6 1 .      Savings  banks  may  purchase,  hold  and  convey  real    may;  be  purchased, 
and  personal  property  as  follows:  held  or  conve})ed. 

1 .  The  lot  and  building  in  which  the  business  of  the  bank  is     j^q^  ^^j  building. 
carried  on;    such  lot  and  building  shall  not  cost  the  savings  bank  an 

amount  exceeding  its  capital  and  surplus;  and  the  authority  of  a 
two-th»rds  vote  of  a  full  board  of  directors  shall  be  necessary  to 
authorize  the  purchase  or  construction  thereof. 

2.  Such  as  may  have  been  mortgaged,  pledged,  or  conveyed  to    Property  in  trust. 
it  in  trust  for  its  benefit  in  good  faith,  for  money  loaned  in  pursuance 

of  the  regular  business  of  the  corporation. 

3.  Such  as  may  have   been  purchased   at   sales   under  pledges.     Purchased 
mortgages  or  deeds  of  trust  made  for  its  benefit  for  money  so  loaned,     under  pledges. 
and  such  as  may  be  conveyed  to  it  by  borrowers  in  satisfaction  and 

discharge  of  loans  made  thereon. 

No  savings  bank  shall  purchase,  hold  or  convey  real  estate  in  any  Restrictions. 
other  case  or  for  any  other  purpose;  and  all  real  estate  described 
in  subdivision  3  of  this  section  must  be  sold  by  the  bank  within  ten 
years  after  the  title  thereto  is  vested  in  it  by  purchase  or  otherwise, 
unless  permission  to  hold  said  real  estate  for  a  longer  period  be 
given  by  the  superintendent  of  banks  in  writing.  Parcels  of  real 
estate  not  sold  within  ten  years,  or  extension  of  said  period  as  above 
provided,  may  be  purchased  by  any  persons  or  parties  wanting 
them,  8t  the  price  to  be  determined  by  arbitration  of  three  persons 
appointed  by  the  superior  court  as  appraisers,  at  the  request  of  the 
would-be  purchaser. 

No  savings  bank  shall  purchase,  own,  or  sell  personal  property, 
except  such  as  may  be  requisite  for  its  immediate  accommodation 
for  the  convenient  transaction  of  its  business,  and  mortgages  on  real 
estate,  bonds,  securities  or  evidences  of  indebtedness,  public 
or  private  gold  and  silver  bullion  and  United  States  mint  certifi- 
cates of  ascertained  value,  and  evidences  of  debt  issued  by  the 
United  States. 

No  savings  bank  shall  purchase,  hold  or  convey  bonds.     Bonds  ivhich 
securities  or  evidences  of  indebtedness,  public  or  private,     "^'^^  "^  " ,     ,  ^ 
except  as  follows:  a  savings  bank. 


26  N.    W.    HALSEY    &   CO. 


United  States       (a)  Bonds  or  interest-bearing  notes  or  obligations  of  the 
bonds.  United  States,  or  those  for  which  the  faith  of  the  United 
State  of  States  is  pledged  for  the  payment  of  interest  and  principal. 
California        (^)  go^^js  o£  ^jjig  gtate. 

(c)  Bonds  of  any  state  in  the  United  States  that  have 

s  oj  any  jjQ^^  within  five  years  previous  to  making  such  investment 

by  such  bank,  defaulted  in  the  payment  of  any  part  of 

either  principal  or  interest  thereof. 

Municipal  and       (J)  Bonds  of  any  city,  county,  city  and  county,  town, 

school  bonds  township  or  school  district  of  this  state. 

in  California.        y  ^    ts      -,       r  •  ,.,,.  , 

(e)  Bonds  of  any  city,  town  or  county  which  has  m  each 

Municipal  bonds  ^  ^^  ^j^^  ^^^^   ^^  ^^^   investment,   more   than   twenty 

issued  outside 
of  California    thousand  inhabitants,  as  ascertained  by  the  United  States 

or  state  census  made  next  preceding  such  investment,  in 
any  of  the  states  of  the  United  States,  other  than  in  the 
State  of  California,  issued  pursuant  to  the  authority  of  any 
law  of  such  states;  provided,  the  entire  bonded  indebted- 
ness of  such  city  or  county  or  town  shall  not  exceed  five 
per  centum  of  the  assessed  value  of  the  taxable  property 
therein,  including  the  issue  of  bonds  in  which  said  invest- 
ment is  made  as  shown  by  the  last  assessment  preceding 
the  investment;  and  provided,  further,  that  such  city,  town 
or  county  or  state  in  which  it  is  situated  has  not  defaulted 
in  the  payment  of  any  part  of  either  principal  or  interest 
thereon  within  five  years  previous  to  making  such 
investment. 
Railroad  bonds.  (/)  First  mortgage  or  underlying  bonds  of  any  steam 
railway,  the  income  of  which  is  sufficient  to  pay  all  oper- 
ating expenses  and  fixed  charges,  and  which  is  completed 
and  operated,  wholly  or  in  part,  in  any  of  the  states  of  the 
United  States. 
Public  service  (§)  Bonds  of  street  railroads,  water,  light,  light  and 
corporation  and  power,  gas,  and  other  public  utility  and  industrial  corpora- 
industrtal  bonds,  ^ions.  All  bonds  authorized  for  investment  by  this  section 
shall  be  secured  by  a  mortgage  or  trust  deed,  which  is, 
at  the  time  of  making  such  investment,  (1)  a  first  or  under- 
lying mortgage  or  trust  deed  of  the  corporation  issuing 


BANK   ACT   OF   CALIFORNIA 27 

said  bonds,  or  (2)  a  refunding  mortgage  or  trust  deed  used 
to  retire  all  prior  lien  mortgage  debts  of  said  corporation 
outstanding  at  the  time  of  making  said  investment;  pro- 
vided, that  the  income  of  such  corporation  is  sufficient  to 
pay  all  operating  expenses  and  fixed  charges  and  such 
income  shall  have  been  so  sufficient  for  the  term  of  three 
years  preceding  the  issuance  of  such  bonds,  or  that  payment 
of  its  said  bonds  have  been  guaranteed  by  a  corporation 
that  has  paid  all  its  operating  expenses  and  fixed  charges 
for  a  period  of  three  years  prior  to  guaranteeing  the  pay- 
ment of  such  bonds. 

(h)  First  mortgage  bonds  or  deeds  of  trust  issued  by    Real  estate 
real  estate  corporations ;  provided,  that  said  bond  issue  shall   corporation 
not  exceed  sixty  per  centum  of  the  market  value  of  the    °°^^^' 
real  estate  taken  as  security. 

No  savings  bank  shall  purchase  the  bonds  of  any  cor-  Limitations. 
poration  or  make  a  loan  on  the  bonds  of  any  corporation, 
if  the  franchise  of  such  corporation  expires  prior  to  the 
maturity  of  its  bonds,  or  if  the  franchise  or  special  privilege 
granted  to  such  corporation  by  any  city,  county,  or  city 
and  county,  expires  before  the  maturity  of  such  bond  issue. 

Sec.  62.  No  savings  bank  shall,  directly  or  indirectly,  deal  or 
trade  in  real  or  personal  property  in  any  other  case  or  for  any  other 
purpose  than  is  authorized  by  this  act,  and  shall  not  contract  any 
debt  or  liability  for  any  purpose  whatever  other  than  for  deposits, 
except  as  in  this  section  provided. 

Savings  banks  may  pay  regular  depositors,  when  requested  by  Deposits  ma^  be 
them,  by  draft  upon  deposits  to  the  credit  with  their  banks,   and   p(iid  b}f  draft. 
charge  current  rate  of  exchange  for  such  drafts. 

No  savings  bank  shall  borrow  money,  or  pledge  or  hypothecate  nojronj'ns 
any  of  its  securities,  except  to  meet  the  immediate  demands  of  its  monev. 
own  depositors,  and  then  only  in  pursuance  of  a  resolution  adopted 
by  a  vote  of  a  majority  of  its  board  of  directors,  duly  entered  upon 
their  minutes,  wherein  shall  be  recorded  the  ayes  and  nays  upon 
each  vote;  also  with  the  written  approval  of  the  superintendent  of 
banks,  and  he  shall  have  the  authority  to  fix  the  amount  to  be 
borrowed,    and   the   term  and  rate  of  interest  thereon;    provided. 


28  N.    W.    HALSEY    &   CO. 

State,  county,  hoTvever,  that  savings  banks  may,  in  the  manner  authorized 

and  municipal  by  law,  and  without  the  written  approval  of  the  superin- 

deposits.  pendent  of  banks,  borrow  the  public  moneys  of  the  state, 

counties,  cities  and  counties,  and  towns  and  receive  such 

public  moneys  on  deposit. 

Certificates  Sec.  63.  Savings  banks  may  issue  general  certificates  of 
of  deposit,  deposit,  which  are  transferable,  as  in  other  cases,  by  indorsement 
and  delivery;  may  issue,  when  requested  by  the  depositor,  special 
certificates,  acknowledging  the  deposit  of  the  person  therein  named 
of  a  specified  sum  of  money,  and  expressly  providing  on  the  face 
of  such  certificate  that  the  sum  so  deposited  and  therein  named  may 
be  transferred  only  on  the  books  of  the  bank;  payment  thereafter 
made  by  the  bank  to  the  depositor  named  in  such  certificate,  or  to 
his  assignee  named  upon  the  books  of  the  bank,  or  in  case  of  death, 
to  the  legal  representative  of  such  person,  of  the  sum  for  which 
such  special  certificate  was  issued,  shall  discharge  the  bank  from  all 
further  liability  on  account  of  the  money  so  paid. 

Time  certificates.  ■^^^  *™^  certificates  of  deposit,  issued  by  a  savings  bank,  shall  be 
subject  to  the  same  limitations  and  conditions  as  applied  to  other 
deposits,  and  notice  thereof  shall  be  given  by  the  words  "Subject  to 
conditions  of  agreement  with  depositors"  printed  on  the  face  of 
the  certificate  issued. 

Withdrawal  of  Sec.  64.  Savings  banks  may  prescribe  by  their  by-laws,  or  by 
deposits,  contract  with  depositors,  the  time  and  conditions  on  which  repayment 
is  to  be  made  to  depositors,  except  as  in  this  act  otherwise  pro- 
hibited; but  whenever  there  is  any  call  by  depositors  for  repayment 
of  a  greater  amount  than  the  bank  may  have  disposable  for  that 
purpose,  the  directors  or  officers  thereof  must  not  make  any  new 
loans  or  investments  of  the  funds  of  the  depositors,  or  of  earnings 
thereof,  until  such  excess  of  call  has  ceased.  The  directors  of  any 
such  bank,  having  no  capital  stock,  must  retain,  on  each  dividend 
day,  at  least  ten  per  centum  of  the  net  profits  of  the  bank,  to 
constitute  a  reserve  fund,  which  must  be  invested  in  the  same 
manner  as  other  funds  of  the  bank,  and  must  be  used  toward 
paying  any  losses  which  the  bank  may  sustain  in  pursuing  its  lawful 
business.     The  bank  may  provide  by  its  by-laws  for  the  disposal 


BANK   ACT   OF   CALIFORNIA  29 

of  any  excess  in  the  reserve  fund,  as  provided  for  in  section  21  of 

this  act,  and  the  final  disposal,  upon  the  dissolution  of  the  bank,  of 

the  reserve   fund,   or  of  the  remainder   thereof,   after  payment  of 
losses. 

Sec.  65.      No  director,   or  officer  of  any  savings  bank  must.  No  director  or 
directly  or  indirectly,    for  himself  or  as   the  partner  or   agent  of   officer  ma^ 
others,  borrow  any  of  the  deposits  or  other  funds  of  such  bank,  nor   "^^^^  °'  oanii. 
must  he  become  an  endorser  or  surety  for  loans  to  others,  nor  in  any 
manner  be  obligor  for  moneys  borrow^ed  of  or  loaned  by  such  bank. 
The  office  of  any  director  or  officer  who  acts  in  contravention  of 
the  provisions  of  this  section  immediately  thereupon  becomes  vacant, 
and  every  director  or  officer  authorizing  or  consenting  to  such  loan, 
and  the  person  who  receives  such  loan,  shall  severally  be  guilty  of 
a  misdemeanor. 

Sec.   66.      Receiving    deposits,    issuing    certificates    of    deposit.  Creation  of  debt 
checks,  and  bills  of  exchange,  and  the  like,  in  the  transaction  of  the  defined. 
business  of  savings  banks,  must  not  be  construed  to  be  the  creation 
of  debt  within  the  meaning  of  the  phrase  "create  debt"  in  section 
three  hundred  and  nine  of  the  Civil  Code  and  as  provided  for  in 
this  act. 

Sec    67.      1.   No   savings   bank   shall    loan    money   except   on  Loans. 
adequate  security  of  real  or  personal  property,   and  no  such  loan 
shall    be    made    for    a    period    longer    than    ten    years;     provided, 
that  no  loans  shall  be  made  on  unsecured  notes. 

2.  No  savings  bank  shall  invest  or  loan  more  than  five  Limitation  of 
per  centum  of  its  assets  on  any  one  bond  issue,  except  ^n'^^^j^^^t  m 
bonds  of  the  United  States,  of  the  State  of  California,  of 

the  counties,  cities  and  counties,  cities  or  school  districts 
of  this  state. 

3.  No  savings  bank  shall  loan  money  to  exceed  ninety  Loan  on  bonds. 
per  centum  of  the  market  value  of  bonds  specified  in  sub- 
divisions (a),  (b),  (c)  and  (J)  of  subdivision  three  of  section  Percentage  of 
sixty-one  of  this  act,  and  no  more  than  eighty-five  per  "'r  •  f  ^^  "f 
centum  of  the  market  value  of  bonds  specified  in  subdivision  loaned  on 

(e)   of  subdivision  three  of  section  sixty-one  of  this  act,  different  classes 
and  no  more  than  seventy-five  per  centum  of  the  market  of  bonds. 


30 


N.    W.    HALSEY    &   CO. 


value  of  bonds  specified  in  subdivisions  (/)  and  (g)  of  sub- 
division three  of  section  sixty-one  of  this  act,  and  no  more 
than  sixty-five  per  centum  of  the  market  value  of  personal 
property  and  stocks  of  corporations  or  banks;  provided, 
horvever,  that  no  loan  shall  be  made  upon  the  capital  stock 
of  any  corporation  or  bank  unless  such  corporation  or  bank 
has  been  in  existence  for  two  or  more  years  and  has  earned 
and  paid  a  dividend  on  its  capital  stock. 

4.  No  savings  bank  shall  make  any  loan  on  the  security  of  real 
estate  except  it  be  a  first  lien  and  in  no  event  to  exceed  sixty  per 
centum  of  the  market  value  of  any  piece  of  real  estate  to  be  taken 
as  security,  except  for  the  purpose  of  facilitating  the  sale  of  property 
owned  by  the  savings  bank;  provided,  that  a  second  lien  may  be 
accepted  to  secure  the  repayment  of  a  debt  previously  contracted 
in  good  faith. 

5.  No  savings  bank  shall  purchase,  invest  or  loan  its  capital  or 
the  money  of  its  depositors,  or  any  part  of  either,  in  mining  shares 
or  stock. 

6.  No  savings  bank  shall  hereafter  make  a  loan  secured  by 
the  stock  of  another  bank,  if  by  making  such  loan  the  total  stock 
of  such  other  bank  held  by  such  loaning  bank  as  collateral  will 
exceed  in  the  aggregate  ten  per  centum  of  the  capital  stock  of  such 
other  bank. 

Any  president  or  managing  officer  who  knowingly  consents  to  a 
violation  of  the  above  provisions  shall  be  deemed  guilty  of  a  felony. 

Sec.  68.  Savings  banks  must  carry  in  cash,  or  its  equivalent, 
an  amount  equal  to  four  per  centum  of  its  deposit  liabilities,  of 
which  two  per  centum  of  such  liabilities  shall  be  in  coin  or  currency 
of  standard  value  in  its  own  keeping.  The  amount  thus  carried 
shall  be  called  the  lawful  money  reserve. 

No  new  loan  shall  be  made  during  any  deficiency  in  the  lawful 
money  leserve. 

Deposits  with  commercial  banks  and  trust  companies,  on  open 
account,  to  facilitate  business  transactions,  as  provided  in  this 
section,  shall  be  permitted,  and  shall  not  be  construed  as  loans. 

Not  more  than  five  per  centum  of  the  deposits  of  any  savings 
bank  shall  be  deposited  with  any  one  bank. 


Percentage  of 

market  value 

tvhich  ma})  be 

loaned  on  real 

estate. 


Mining  stocks 

can  not  be 

purchased  or 

accepted  as 

collateral. 

Stock  of  other 

banks  as 

collateral. 


Laivful  money) 
reserve. 


Deposits  Tvith 
other  banks. 

Limitations. 


BANK   ACT   OF   CALIFORNIA  31 

Sec.  69.  Every  savings  bank,  and  the  business  of  every 
savings  department  of  every  other  bank,  must  be  conducted  under 
and  in  accordance  with  the  provisions  of  this  act. 

Article  III. 

COMMERCIAL   BANKS. 

Sec.  80.  No  commercial  bank  shall  make  any  loans  to  any  Loans, 
person,  company,  corporation  or  firm  to  an  amount  exceeding  one- 
tenth  part  of  the  capital  stock  of  such  bank  actually  paid  in  and 
surplus;  provided,  however,  that  a  bank  may  loan  to  any  person, 
company,  corporation  or  firm  a  sum  not  exceeding  twenty-five  per 
centum  of  its  capital  stock  actually  paid  in  and  surplus  upon 
security  worth  at  least  fifteen  per  centum  more  than  the  amount  of 
its  loans;  or  it  may  loan  ten  per  centum  of  such  capital  and  surplus 
as  first  above  provided,  and  a  further  sum  not  exceeding  fifteen 
per  centum  of  such  capital  and  surplus  upon  security  worth  at  least 
fifteen  per  centum  more  than  the  amount  of  such  loan  so  secured; 
except  that  a  commercial  bank  may  buy  from,  or  discount,  for  any 
person,  company,  corporation  or  firm,  or  loan  upon  bills  of  lading, 
warehouse  receipts  and  bills  of  exchange,  drawn  in  good  faith 
against  actual  existing  value  or  against  commercial  or  business 
paper  actually  owned  by  the  person  negotiating  the  same. 

Sec,  8L      No   loan   shall   be  made   by   any   commercial   bank  Corporation 
upon  the  securities  of  one  or  more  corporations,   the  payment  of  f^oans. 
which  is  undertaken,  in  whole  or  in  part,  severally,  but  not  jointly, 
by  two  or  more  individuals,  firms,  or  corporations: 

(a)  If  the  borrowers  or  underwriters  be  obligated  absolutely  or 
contingently  to  purchase  the  securities,  or  any  of  them,  collateral  to 
such  loan,  unless  the  borrowers  or  underwriters  shall  have  paid  on 
account  of  the  purchase  of  such  securities  an  amount  in  cash,  or  its 
equivalent,  equal  to  at  least  twenty-five  per  centum  of  the  several 
amounts  for  which  they  remain  obligated  in  completing  the  purchase 
of  such  securities; 

(b)  If  the  commercial  bank  making  such  loan  be  liable,  directly 
or  indirectly,  or  contingently,  for  the  repayment  of  such  loan  or 
any  part  thereof; 


32 


N.    W.    HALSEY    &   CO. 


(c)  If  its  term,  including  any  renewal  thereof  by  agreement, 
express  or  implied,  exceed  the  period  of  one  year; 

(d)  Or  to  an  amount  under  any  circumstances  in  excess  of 
twenty-five  per  centum  of  the  capital  and  surplus  of  the  commercial 
bank  making  such  loan. 

Capital  required.  Sec.  82.  Every  commercial  bank  which  is  now  transacting,  or 
which  may  hereafter  transact  business,  shall  have  actually  paid  in 
d  capital  stock  of  not  less  than  twenty-five  thousand  dollars;  and 
until  said  sum  of  twenty-five  thousand  dollars  shall  be  actually 
paid  in,  the  superintendent  of  banks  shall  not  issue  the  certificate 
required  by  section  twenty- four  of  this  act;  provided  that  nothing 
herein  shall  be  construed  to  affect  the  provisions  of  section  twenty- 
three  of  this  act  relative  to  the  capital  stock  required  of  banks 
doing  a  departmental  business. 


Loans  to 
directors. 


Sec.  83.  No  commercial  bank  shall  loan  any  of  its  funds  to 
any  of  its  directors  unless  such  loan  shall  first  have  been  approved 
by  a  two-thirds  vote  of  its  board  of  directors,  on  which  vote  the 
borrowing  director  shall  not  participate,  and  the  fact  of  making 
such  loan,  the  name  of  the  director  borrowing  the  same,  the  time 
when  the  same  shall  become  due,  the  rate  of  interest  thereon,  and 
the  amount,  value,  and  character  of  the  security  pledged  therefor, 
if  any,  shall  be  forthwith  forwarded  by  the  cashier  of  such  bank 
to  the  superintendent  of  banks;  and  if  the  superintendent  of  banks 
shall  disapprove  of  such  loan,  he  shall  immediately  notify  such 
bank  of  his  disapproval  thereof,  and  such  bank  shall  forthwith 
collect  such  loan;  provided,  however,  that  the  total  loans  to  all 
directors  of  such  bank  shall  not  at  any  one  time  exceed  thirty  per 
cent  of  the  capital  and  surplus  of  such  bank;  and  provided, 
further,  that  each  bank  having  any  loan  or  loans  outstanding  to 
any  of  its  directors  shall  once  each  month  report  in  writing  to  the 
superintendent  of  banks  the  name  of  each  director  to  whom  such 
loan  is  made,  the  amount  of  such  loan,  the  rate  of  interest  thereon, 
the  time  when  the  same  shall  fall  due,  and  the  security  pledged 
therefor,  if  any.  Any  officer  or  director  of  any  commercial  bank 
violating  any  of  the  provisions  of  this  section  shall  be  guilty  of 
a  felony. 


BANK   ACT   OF   CALIFORNIA 33 

Article  IV. 

TRUST   COMPANIES. 

Sec.  90.  Any  corporation  which  has  been  or  shall  be  incor-  Capital  required. 
porated  under  the  general  incorporation  laws  of  this  state,  authorized 
by  its  articles  of  incorporation  to  act  as  executor,  administrator, 
guardian,  assignee,  receiver,  depositary  or  trustee,  and  having  a 
capital  of  not  less  than  two  hundred  thousand  dollars  actually  paid 
in,  in  cash,  may  be  appointed  to  act  in  such  capacity  in  like 
manner  as  individuals  and  shall  be  known  as  a  trust  company.  In 
all  cases  in  which  it  is  required  that  an  executor,  administrator, 
guardian,  assignee,  receiver,  depositary  or  trustee,  shall  qualify  by 
taking  and  subscribing  an  oath,  or  in  which  an  affidavit  is  required, 
it  shall  be  a  sufficient  quahfication  by  such  corporation  if  such  oath 
shall  be  taken  and  subscribed  or  such  affidavit  made  by  the  president 
or  secretary  or  manager  or  trust  officer  thereof,  and  such  officer 
shall  be  liable  for  the  failure  of  such  trust  company  to  perform 
any  of  the  duties  required  by  law  to  be  performed  by  individuals 
acting  in  like  capacity  and  subject  to  like  penalties;  and  such  trust 
company  shall  be  liable  for  such  failure  to  the  full  amount  of  its 
capital  stock;  provided,  any  such  appointment  as  guardian  shall 
apply  to  the  estate  only,  and  not  to  the  person.  Such  trust  company 
shall  be  entitled  to  and  shall  be  allowed  proper  compensation  for 
all  the  services  performed  by  them  under  the  foregoing  provisions 
of  this  act;  but  such  compensation  shall  not  exceed  that  allowed 
to  natural  persons  for  like  services. 


court 


Sec.  91.  Any  court,  having  appointed  and  having  jurisdiction  Deposits  b^ 
of  any  executor,  administrator,  guardian,  assignee,  receiver,  depos-  ^^thoril^  of 
itary,  or  trustee,  upon  the  application  of  such  officer  or  trustee,  or 
upon  the  application  of  any  person  having  an  interest  in  the  estate 
administered  by  such  officer  or  trustee,  after  notice  to  the  other 
parties  in  interest  as  the  court  may  direct,  and  after  a  hearing  upon 
such  application,  may  authorize  such  officer  or  trustee  to  deposit 
any  moneys  then  in  his  hands,  or  which  may  come  into  his  hands 
thereafter,  and  until  the  further  order  of  said  court,  with  any  such 
trust  company;  and  upon  deposit  of  such  money,  and  its  receipt 
and  acceptance  by  such  trust  company,  the  said  officer  or  trustee 


34  N.    W.    HALSEY    &   CO. 

shall    be    discharged    from    further    care    or   responsibility    therefor. 
Such  deposits  shall  be  paid  out  only  upon  the  orders  of  said  court. 

Deposits  b^  Sec.  92.  It  shall  be  lawful  for  any  public  administrator  to 
.  .  P"^"^  deposit  with  any  trust  company  having  not  less  than  two  hundred 
thousand  dollars  paid-up  capital,  doing  business  in  the  county,  or 
city  and  county,  in  which  he  is  acting  as  such  administrator,  any 
and  all  moneys  of  any  estate  upon  which  he  is  administering,  not 
required  for  the  current  expenses  of  the  administration;  provided 
that  such  corporation  deposit  with  the  state  treasurer  the  securities 
required  by  this  act.  Such  deposits  shall  relieve  the  public  admin- 
istrator from  depositing  with  the  county  treasurer  the  moneys  so 
deposited  with  such  corporation.  Moneys  so  deposited  by  a  public 
administrator  may  be  drawn,  upon  the  order  of  such  administrator, 
countersigned  by  a  judge  of  a  superior  court,  when  required  for 
the  purpose  of  administration,  or  otherwise. 

Deposits  b^f  Sec.  93.  Whenever,  in  the  judgment  of  any  court  having 
order  of  court,  jurisdiction  of  any  estate  in  process  of  administration  by  any 
executor,  administrator,  guardian,  assignee,  receiver,  depositary,  or 
trustee,  and  after  such  notice  to  the  parties  in  interest  as  the  court 
shall  direct,  and  after  a  hearing  on  such  application,  the  said  court 
may  order  the  said  officer  or  trustee  to  deposit  with  any  such  trust 
company,  for  safe  keeping,  such  portion  or  all  of  the  personal 
assets  of  said  estate  as  it  shall  deem  proper;  and  thereupon  said 
court  shall,  by  an  order  of  record,  reduce  the  bond  to  be  given  or 
theretofore  given  by  such  officer  or  trustee,  so  as  to  cover  only  the 
estate  remaining  in  the  hands  of  said  officer  or  trustee;  and  the 
property  as  deposited  shall  thereupon  be  held  by  such  trust  company, 
under  the  orders  and  directions  of  said  court.  Any  court  having 
jurisdiction  of  an  estate  being  administered  by  a  public  administrator, 
may  direct  such  public  administrator  to  deposit  all  or  any  part  of 
the  moneys  of  the  estate  not  required  for  the  current  expenses  of 
the  administration,  with  any  such  trust  company  doing  business  in 
the  county,  or  city  and  county,  where  such  public  administrator 
is  acting. 

Responsibility       Sec.  94.     Such   trust  company  shall  not  be   required   to   give 
for  investments,  any   bond    or   security    in    case    of    any    appointment    hereinbefore 


BANK   ACT   OF   CALIFORNIA 35 

provided  for,  except  as  hereinafter  provided,  but  shall  be  responsible 
for  all  investments  which  shall  be  made  by  it  of  the  funds  which 
may  be  entrusted  to  it  for  investment  by  such  court,  and  shall  be 
Hable  as  natural  persons  in  like  positions  now  are,  and  as  herein- 
after provided. 

Sec.  95.     Such    trust    company    shall    pay    interest    upon    all   Payment  of 
moneys  held  by  it  as  trustee,  by  virtue  of  this  act,  at  such  rate  as   interest. 
may  be  agreed  upon  at  the  time  of  its  acceptance  of  any  such 
appointment,  or  as  shall  be  provided  by  the  order  of  the  court. 

Sec.  96.  Each  trust  company,  before  accepting  any  such  Bonds  or 
appointment  or  deposit,  shall  deposit  with  the  treasurer  of  state,  securities  to  be 
for  the  benefit  of  the  creditors  of  said  trust  company,  the  ^^P^sited  r»ith 
sum  of  one  hundred  thousand  dollars  ($100,000),  in  bonds 
of  the  United  States,  or  municipal  bonds  of  this  state,  or  of 
any  county,  or  city,  city  and  county,  or  school  district 
thereof,  or  on  mortgages  on  improved  and  productive  real  estate  in 
this  state,  being  first  liens  thereon;  said  bonds  or  mortgages 
to  be  approved  by  the  superintendent  of  banks.  The  bonds 
and  securities  so  deposited  may  be  exchanged  from  time  to 
time  for  other  securities,  receivable  as  aforesaid.  Said  bonds 
of  the  United  States,  or  municipal  bonds  of  this  state,  or 
of  any  county,  city,  city  and  county,  or  school  district 
thereof,  to  be  registered  in  the  name  of  said  treasurer, 
officially,  and  all  said  securities  to  be  subject  to  sale  and 
transfer,  and  to  the  disposal  of  the  proceeds  by  said  treas- 
urer, only  on  the  order  of  a  court  of  competent  jurisdiction 
and  as  hereinafter  provided.  The  state  shall  be  responsible 
for  the  safe  return  of  such  securities  deposited  with  the 
treasurer  of  the  state,  under  this  section. 

'    Sec.  97.     Any  such  trust  company,  having  a  paid-up  capital  in   Property  may 

excess  of  two  hundred  thousand  dollars,  may  be  permitted  by  the   ^^  mortgaged. 

superintendent  of  banks  to  mortgage  any  improved  and  productive 

real  estate  owned  by  it,  in  excess  of  said  amount,  to  the  treasurer 

of   state,   for  such   sum   as   the   said  superintendent  of  banks  may 

determine,  and  such  mortgage  may  be  deposited  with  said  treasurer, 

and   when    so    deposited    it   shall    be    included    in    the    amount    of 


36  ■  N.    W.    HALSEY    &   CO. 

securities  hereinabove  required  to  be  deposited  with  said  treasurer 
for  the  benefit  of  the  creditors  of  said  trust  company. 

Interest  on      Sec.  98.     So  long  as  the  trust  company  so  depositing 
bonds  deposited,  shall  continue  solvent,  it  shall  be  permitted  to  receive  from 
said  treasurer  the  interest  or  dividends  on  said  deposits, 
and  whenever  any  trust  company  receives  trust  funds  as 
such  trustee  in  excess  of  five  hundred  thousand  dollars,  it 
shall  deposit  with  the  state  treasurer  securities  mentioned 
in  section  96  of  this  act,  to  be  approved  by  the  superin- 
tendent of  banks,  in  the  amount  of  another  one  hundred 
thousand  dollars,  and  for  each  five  hundred  thousand  dollars 
of  such  trust  funds  thereafter  received,  an  additional  deposit 
Amount  of  of  fifty  thousand  dollars  of  such  securities  likewise  approved 
deposit  required  shall  be  made  with  the  said  state  treasurer;    provided,  hoT»- 
as  securij)  jor  ^^^^    ^^^^  ^^  trust  company  shall  be  required  to  deposit 
trust  funds.  /      •"  ^      . 

more  than  one  million  dollars  of  such  securities. 

The  state  shall  be  responsible  for  the  safe  return  of  such 
securities  deposited  with  the  treasurer  of  the  state  under 
this  section. 

Certificates  of       Sec.  99.     When    any    part    of    such    deposit    with    the    state 
Title  required  treasurer  is  made  in  bonds  and  mortgages,  it  shall  be  accompanied 
with  rnortgages  ^^  ^^jj  abstracts  of  titles  and  searches,   or  by  certificates  of  title 
issued   by   a   person,    company   or   corporation,   whose   business    or 
objects  are  to  make  searches  of  titles  and  issue  certificates  of  titles, 
and  which  said  person,  company  or  corporation  shall  be  one  desig- 
nated or  approved  by  said  superintendent  of  banks,   and  shall  be 
Fees  of  counsel  examined    and   approved   by    or    under    the    direction   of   the    said 
and  appraisers,  superintendent  of  banks.     The  fees  for  an  examination  of  title  by 
malting  ^.^unsel  to  be  paid  by  the  trust  company  making  the  deposit,  shall 
exami  ^  °  •  j^^j  exceed  twenty  dollars  for  each  mortgage,  and  the  fee  for  each 
appraiser,  not  exceeding  two,  besides  expenses,  shall  be  five  dollars 
for  each  mortgage. 

Affidavit  of       Sec.    100.  Before  the  superintendent  of  banks  issues  his   cer- 

•    Ah^i^^^  tificate  to  any  trust  company,  there  must  be  filed  in  his  office  the 

require       ejo  e  ^^^^^-^y^  ^^   ^  majority   of   its   board   of   directors   or   the   persons 

issued,  named  in  said  articles  as  the  first  directors  of  the  corporation  that 


BANK   ACT   OF   CALIFORNIA 37 

at  least  two  hundred  thousand  dollars  of  the  capital  stock  has 
actually  been  subscribed  and  paid  in  to  a  person  named  in  such 
affidavit  for  the  benefit  of  the  corporation. 

Sec.  101.  On  making  the  report  required  by  the  terms  of  this  List  of  trusts. 
act,  every  trust  company  shall,  in  addition  to  the  other  facts  to  be 
reported  on,  furnish  a  list  and  brief  description  of  the  trusts  held 
by  such  corporation,  the  source  of  the  appointment  thereto,  and  the 
amount  of  real  and  personal  estate  held  by  such  trust  company  by 
virtue  thereof;  except  that  mere  mortgage  trusts,  wherein  no  action 
has  been  taken  by  such  corporation,  shall  not  be  included  in  such 
statement. 

Sec.   1 02.     Any   trust  company  which   desires   to  retire   from  Retiring  from 
business  under  this  act,  shall  furnish  to  the  superintendent  of  banks  business. 
satisfactory    evidence    of    its    release    and    discharge    from    all    the 
obligations  and  trusts  hereinbefore  provided  for;  whereupon  he  shall 
revoke   his   certificate    to   such    trust   company,    and    thereupon    the 
treasurer  of  state  shall  return  to  said  trust  company  all  its  securities. 

Sec.    103.     Except    as    herein    otherwise    provided,    any    trust  Confidential 
company  exercising  the  powers  and  performing  the  duties  provided  relations  of  trust 
for  in  this  act,  shall  keep  inviolate  all  communications  confidentially  ^^p^P^^^  *o 
made    to    it    touching    the    existence,    condition,    management    and 
administration   of   any   trusts   confided   to   it;     and   no   creditor   or 
stockholder  of  any  such  trust  company  shall  be  entitled  to  disclosure 
of  any  such  communication;    provided,  however,  that  the  president, 
manager  and  secretary  of  such  trust  company  shall  be  entitled  to 
knowledge  of  such  communication;    and  provided,  further,  that  in 
any  suit  or  proceeding  touching  the  existence,  condition,  management 
or  administration  of  such  trust,  the  court  wherein  the  same  is  pending 
may  require  disclosure  of  any  such  communication. 

Sec.    104.     The  use  of  the  word  "trust"  in  combination  with   Companies  not 
or  in  connection  with  the  word  "company,"  "corporation,"  "incor-   organized  under 
poration,"  "association,"  "society,"  "organization,"  or  "syndicate,"         j^?.    ,  . 
is  hereby  prohibited  to  all  persons,  firms,  associations,  companies  or       •  i 

corporations  other  than  corporations  provided  for  by  this  act.    Every   "tfust." 
person,   firm,   association,   company,   or  corporation  which   uses   the 
word    "trust"    in    combination    with    or    in    connection    with    the 


38  N.    W.    HALSEY    &   CO. 

word  "company,"  "corporation,"  "incorporation,"  "association," 
"society,"  "organization,"  or  "syndicate,"  as  the  name  under  which 
business  is  done  or  transacted,  shall  be  subject  to  the  provisions  of 
this  act  and  to  the  supervision  of  the  superintendent  of  banks.  Any 
person,  firm,  association,  company,  or  corporation  making  use  of 
the  word  "trust"  in  combination  or  in  connection  with  the 
word  "company,"  "corporation,"  "incorporation,"  "association," 
"society,"  "organization,"  or  "syndicate,"  in  the  manner  herein- 
above mentioned,  in  the  transaction  of  business,  and  not  subject  to 
the  provisions  of  this  act  and  the  supervision  of  the  superintendent 
of  banks,  shall  be  guilty  of  a  misdemeanor. 

No  corporation  hereafter  formed  shall  use  the  word  "trust"  or 
"trustee"  as  a  part  of  its  corporate  name  unless  it  shall  be  authorized 
by  its  articles  of  incorporation  to  act  as  executor,  administrator, 
guardian,  assignee,  receiver,  depositary  or  trustee;  nor  shall  any 
corporation  hereafter  formed  accept  or  execute  any  trust  mentioned 
in  this  act,  unless  it  shall  have  complied  with  the  provisions  of 
this  act. 

Investment  of      Sec.   1 05.     Every  trust  company  shall  invest  its  capital 

trust  funds.  ^^^  trust  funds  received  by  it  in  accordance  with  the  laws 

relative  to  the  investment  of  funds  deposited  with  savings 

banks,  unless  a  specific  agreement  to  the  contrary  is  made 

between  the  trust  company  and  the  party  creating  the  trust. 

Department  Sec.  106  Every  trust  company  desiring  to  do  or  doing  a 
business,  commercial  banking  business  or  a  savings  bank  business,  or  both, 
in  addition  to  its  trust  business,  shall  have  paid  up  in  cash  the 
capital  as  provided  in  section  twenty-three  of  this  act.  Such  capital 
for  each  such  department  shall  be  increased  from  time  to  time  in 
the  same  manner  and  to  the  same  extent  as  though  such  bank  were 
conducting  separate  banks  instead  of  separate  departments. 

Every  trust  company  doing  a  departmental  business  shall  comply 
with  the  provisions  of  this  act  governing  each  of  such  departments 
as  to  its  deposits,  reserves,  investments  and  loans. 


BANK   ACT   OF   CALIFORNIA  39 

Article  V. 

STATE    BANKING   DEPARTMENT. 

Sec.  120.  There  is  hereby  created  a  state  banking  department.  Superintendent 
The  chief  officer  of  such  department  shall  be  the  superintendent  °^  ^nf(S. 
thereof,  and  be  known  as  the  superintendent  of  banks.  He  shall 
be  appointed  by  the  governor,  and  shall  hold  his  office  for  a  term 
of  four  years,  or  until  his  successor  shall  have  been  appointed  and 
qualified.  No  person  shall  be  appointed  superintendent  of  banks 
who  has  not  had  active  banking  experience,  either  as  executive  officer 
or  director  of  some  commercial  bank,  savings  bank  or  trust  company, 
at  least  one-half  of  which  experience  has  been  had  in  this  state. 
He  shall  not,  either  directly  or  indirectly,  be  interested  in  any 
commercial  bank,  savings  bank  or  trust  company,  or  as  an  individual 
banker.  He  shall  receive  an  annual  salary  of  ten  thousand  dollars, 
to  be  paid  monthly  out  of  the  state  treasury  on  a  warrant  of  the 
controller.  He  shall,  within  fifteen  days  from  the  time  of  notice 
of  his  appointment,  take  and  subscribe  to  the  constitutional  oath  of 
office,  and  file  the  same  in  the  office  of  the  secretary  of  state,  and 
execute  to  the  people  of  the  state  a  bond  in  the  penal  sum  of  fifty 
thousand  dollars,  with  corporate  surety  or  two  or  more  sureties  to 
be  approved  by  the  governor  of  the  state,  conditioned  for  the 
faithful  discharge  of  the  duties  of  his  office. 

Sec.  121.  The  superintendent  of  banks  shall  employ  a  chief  Departmental 
d^uty,  attorney  and  such  clerks  and  examiners  as  he  may  need  to  P  ■>  • 
discharge  in  a  proper  manner  the  duties  imposed  upon  him  by  law, 
none  of  which  examiners  or  clerks  or  attorney  shall  be  interested 
in  any  bank  in  this  state  as  director,  stockholder,  officer  or  employee; 
they  shall  perform  such  duties  as  he  shall  assign  to  them.  He  shall 
fix  the  compensation  of  the  attorney,  clerks,  and  examiners,  which 
compensation  shall  be  paid  monthly,  on  his  certificate  and  on  the 
warrant  of  the  controller,  out  of  the  state  treasury.  The  chief 
deputy  shall,  within  fifteen  days  from  the  time  of  his  appointment, 
take  and  subscribe  to  the  constitutional  oath  of  office,  and  file  the 
same  in  the  office  of  the  secretary  of  state,  and  his  compensation 
shall  be  four  thousand  dollars  per  annum;    provided,  however,  that 


40 N.    W.    HALSEY    &   CO. 

the  total  expenditure  provided  for  in  this  act  shall  not  exceed 
seventy-five  thousand  dollars  per  annum. 
Chief  detutv  ^°  person  shall  be  appointed  a  chief  deputy  who  has  not  had 
superintendent,  at  least  three  years'  active  banking  experience,  either  as  an  executive 
officer  or  employee  of  some  bank  in  this  state.  In  case  of  the 
absence  or  inability  to  act,  or  vacancy  in  the  office  orf  superintendent 
of  banks  for  thirty  consecutive  days,  the  chief  deputy  shall  execute 
to  the  people  of  the  state  a  bond  in  the  penal  sum  of  fifty  thousand 
dollars,  with  corporate  surety  or  two  sureties  to  be  approved  by 
the  controller  and  treasurer  of  the  state,  conditioned  for  the  faithful 
discharge  of  the  duties  of  the  superintendent  while  such  deputy 
acts  as  superintendent,  and  upon  filing  such  bond  such  deputy  shall 
have  all  the  power  and  duties  of  superintendent  of  banks,  until  the 
inability  of  the  superintendent  shall  be  removed,  or  until  a  new 
superintendent  of  banks  shall  have  been  appointed  by  the  governor. 
No  superintendent  of  banks,  chief  deputy  or  bank  examiner  shall  be 
or  shall  become  indebted,  directly  or  indirectly,  either  as  borrower, 
endorser,  surety,  or  guarantor  to  any  bank  under  his  supervision  or 
subject  to  his  examination. 

Location  of  Sec.  122.  The  superintendent  of  banks  shall  have  his  principal 
officers,  ogjce  in  the  city  of  San  Francisco,  and  may  also  have  suitable 
rooms  in  the  city  of  Los  Angeles,  wherein  to  conduct  the  business 
of  the  state  banking  department.  The  superintendent  shall,  from 
time  to  time,  obtain  the  necessary  furniture,  stationery,  fuel,  lights, 
and  other  proper  conveniences  for  the  transaction  of  such  business; 
the  expense  of  which  shall  be  paid  out  of  the  state  treasury  on  the 
certificate  of  the  superintendent  and  the  warrant  of  the  controller. 

State  banking  Sec.  123.  A  fund  is  hereby  created,  to  be  known  as  the  state 
fund,  banking  fund,  and  out  of  said  fund  shall  be  paid  all  the  expenses 
incurred  in  and  about  the  conduct  of  the  business  of  the  banking 
department,  including  the  salary  of  the  superintendent,  chief  deputy, 
attorney,  clerks  and  examiners,  traveling  expenses,  furnishing  of 
rooms  and  rer.t.  Each  bank  shall  pay  annually  its  share  of  the 
total  amount  of  the  salaries  and  expenses  of  the  banking  department, 
to  be  determined  by  the  proportion  which  the  deposits  of  any  such 
bank  bear  to   the   aggregate  deposits  of   all   such  banks   receiving 


BANK   ACT   OF   CALIFORNIA 4! 

certificates  of  authorization  from  the  superintendent  of  banks,  as 
shown  by  the  last  report  of  such  bank  to  the  superintendent  of 
banks. 

All  moneys  collected  or  received  by  the  superintendent  of  banks, 
under  and  by  virtue  of  the  provisions  of  this  act,  shall  be  by  him 
delivered  to  the  treasurer  of  the  state,  who  shall  deposit  the  same 
to  the  credit  of  said  banking  fund,  and  the  unexpended  balances  of 
all  moneys  heretofore  paid  into  the  state  treasury  by  any  of  the 
bank  commissioners  shall  be  retained  and  become  a  part  of  said 
fund.  If  any  such  bank  shall  fail  to  pay  such  charges  as  are 
herein  required,  the  superintendent  shall  forthwith  cancel  the  cer- 
tificate of  saii  bank. 

Sec.  124.  Every  bank  shall  be  subject  to  the  inspection  of  the  Inspection  of 
superintendent  of  banks.  The  superintendent  of  banks,  the  chief  banlis. 
deputy,  or  some  competent  person  or  persons  to  be  appointed  by 
the  superintendent  of  banks,  to  be  known  as  examiners,  shall  visit 
and  examine  every  bank,  other  than  a  savings  bank,  at  least  twice 
in  each  year,  and  every  savings  bank  at  least  once  in  each  year. 
On  every  such  examination  inquiry  shall  be  made  by  him  as  to  the 
condition  and  resources  of  the  bank,  the  mode  of  conducting  and 
managing  its  affairs,  the  action  of  its  directors,  the  investment  and 
disposition  of  its  funds,  the  safety  and  prudence  of  its  management, 
die  security  afforded  to  those  by  whom  its  engagements  are  held 
rmd  whether  the  requirements  of  its  articles  of  incorporation  and 
the  law  have  been  complied  with  in  the  administration  of  its  affairs, 
and  as  to  such  other  matters  as  the  superintendent  may  prescribe. 
He  shall  have  power  in  like  manner  to  examine  every  bank 
whenever,  in  his  judgment,  its  condition  and  management  is  such 
as  to  render  an  examination  of  its  affairs  necessary  or  expedient. 

He  shall  also  have  power  to  examine,  or  cause  to  be  examined,  ^''<")cnes  oj 
every  agency  located  in  this  state  of  any  foreign  bank  or  banking 
corporation,  for  the  purpose  of  ascertaining  whether  it  has  complied 
with  the  laws  of  the  state,  and  for  such  other  purposes  and  as  to 
such  other  matters  as  the  superintendent  may  prescribe. 

The  superintendent,  chief  deputy,  and  every  such  examiner  shall 
have  the  power  to  administer  an  oath  to  any  person  whose  testimony 
he  may  require  on  the  examination  of  any  bank,  or  on  the  examination 


42 N.    W.    HALSEY    6r   CO. 

of  any  agency  of  any  foreign  bank  or  banking  corporation, 
and  to  compel  appearance  and  attendance  of  any  such  person  for 
the  purpose  of  any  such  examination.  The  result  of  such  exam- 
ination shall  be  certified  by  the  persons  making  the  examination  on 
the  records  of  the  bank  examined. 

When  a  bank  shall  have  been  examined  by  any  examiner,  and 
he  finds  securities  therein  which  are,  in  his  judgment,  of  doubtful 
value,  he  shall  report  the  same  to  the  superintendent  of  banks,  who 
thereupon  shall  be  authorized  to  employ  appraisers  to  appraise  said 
securities,  at  a  compensation  to  be  fixed  by  the  superintendent  of 
banks. 

Examiners.  Sec.  125.  Every  examiner  appointed  by  the  superintendent  of 
banks  shall,  before  entering  upon  the  discharge  of  his  duties,  take 
the  constitutional  oath  of  office  and  cause  the  same  to  be  filed  in 
the  office  of  the  secretary  of  state.  No  such  examiner  shall  be 
appointed  receiver  of  any  bank  whose  books,  papers  and  affairs  he 
shall  have  examined  pursuant  to  his  appointment. 

Neglect  to       Sec.    126.      If   the  chief   deputy   or   any   examiner   shall   have 

report  unsafe  knowledge    of    the    insolvency    or    unsafe    condition    of    any    bank 

condition,  jnentioned  in  this  act,  and  that  it  is  unsafe  or  inexpedient  to  permit 

said  bank  to  continue  business,  and  shall  neglect  to  forthwith  report 

such  fact  in  writing  over  his  signature  to  the  superintendent  of  banks, 

he  shall  be  guilty  of  felony. 

Certificate  from       Sec.    127.      No  bank  shall  transact  any  business  in  this  state 
Superintendent  without  the  written  approval  of  the  superintendent  of  banks,   and 
necessary  for  ^JiJ^Qut  his  written  certificate  stating  that  it  has  complied  with  the 
ifef'na  Affcmoc/  provisions  of  this  act,  and  with  all  the  requirements  of  law,   and 
that   it    is    authorized    to   transact,    within    this    state,    the   business 
specified  therein,   and  that  the  requisite  capital  has  been  in   good 
faith  subscribed  and  paid  up  in  cash,  or,  if  organized  without  capital 
stock  that  it  has  accumulated  the  requisite  surplus  or  reserve  fund. 
Before    issuing   such   certificate    the    superintendent   of   banks    shall 
examine,  or  cause  an  examination  to  be  made,  in  order  to  ascertain 
whether  the  requisite  capital  of  such  bank  has  been  paid  up  in  cash 
or  the  requisite  reserve  or  surplus  fund  has  been  accumulated.     The 
superintendent  of  banks  shall  not  authorize  such  bank  to  commence 


banking  business. 


BANK   ACT   OF   CALIFORNIA 43 

business  until  it  appears  from  such  examination,  or  other  evidence 
satisfactory  to  him,  that  the  requisite  capital  has  been,  in  good 
faith,  subscribed  and  paid  in  in  cash,  or  that  the  requisite  surplus 
or  reserve  fund  has  been  accumulated  or  paid  in  in  cash,  and  until 
such  bank  shall  have  paid  a  fee  of  fifty  dollars.  Every  person 
who  neglects  to  comply  with  any  requirement  of  this  section  shall 
be  guilty  of  a  misdemeanor. 

Sec.    128.     When  the  articles  of  incorporation  shall  have  been   Investigation  of 
filed   with   the   secretary   of   state,    and    application   made    for   the  applications  for 
issuance  of  a  certificate  to  do  business  as  a  bank,  the  superintendent  cerft^ca/e. 
of  bank  shall  ascertain,  from  the  best  sources  of  information  at  his 
command,  whether  the  character  and  general  fitness  of  the  persons 
named  as  stockholders  are  such  as  to  command  the  confidence  of 
the  community  in  which  such  bank  is  proposed  to  be  located,  and, 
if  so  satisfied,  he  shall,  within  sixty  days  after  such  application  has 
been   made   to  him,   issue,   under   his   hand   and   official   seal,    the 
certificate  of  authorization  required  by  this  act.     The  superintendent 
of  banks  shall  transmit  such  certificate  of  authorization  to  the  county 
clerk  of  such  county,  who  shall  file  the  same;  the  superintendent  of 
banks  shall  also  file  a  duplicate  of  such  certificate  in  his  own  office. 

Sec.    129,     Every   bank   doing   a    departmental   business    shall    Reports  h^ 
render  to  the  superintendent  of  banks  for  each  department  conducted    departmental 
by  it,  a  separate  report  showing  in  detail  as  required  by  section  one    oanifs. 
hundred   thirty  of  this   act,   the  actual   financial   condition  of  such 
department  and  shall  at  the  time  of  furnishing  said  report  separately 
publish  the  statement  for  each  department  as  provided  in  section 
one  hundred  thirty-two  of  this  act. 

Sec.    1 30.     Every  bank  doing  business  in  this  state  shall,  when-    Character  of 
ever  required   by  the   superintendent   of  banks,   make   a   report   in    report  required 
writing  to  him,  verified  by  the  oath  of  its  president  and  its  secretary    "P°"  demand  of 
or  cashier,  or  two  principal  officers.     Such  reports  shall  show  the    •^"P^'''"'^""^"** 
actual   financial  condition  of  the  bank  making  the  report,   at   the 
close  of  any  past  day  specified  by  the  superintendent,   and  shall 
specify  the  following: 

I.   The  amount  of  its  capital  stock  and  the  number  of  shares    Capital. 
into  which  it  is  divided,   or,   if  not  incorporated,   the   amount  of 
capital  actually  paid  in,  and  by  whom. 


44 N.    W.    HALSEY    &   CO. 

Names  of       2.  The  names  of  the   directors  and  the   number  of  shares   of 
directors,  stock  held  by  each,   or,   if  not  incorporated,   the  names   of  each 
member  of  the  firm  and  the  amount  of  capital  paid  in  by  each. 

Reserve  funds,        3.  The  total  amount  of  capital  actually  paid  up  in  money,  and 
^'^*   the  total  amount  of  contingent  and  other  reserve  funds,  if  any. 

Liabilities.       4.  The  total  amount  due  the  depositors. 

5.  The  total  amount  and   character  of   any  other  liabilities   it 
may  have. 

Real  estate.  6.  The  amount  at  which  the  lot  and  building  occupied  by  the 
bank  for  the  transaction  of  its  regular  business  stands  debited  on  its 
books,  together  with  the  market  value  of  all  other  real  estate  held, 
whether  acquired  in  settlement  of  loans  or  otherwise;  the  amount 
at  which  it  stands  debited  on  the  bank  books,  in  what  counties 
situated,  and  in  what  name  the  title  is  vested,  if  not  in  the  name 
of  the  bank  itself. 

Loans  on  7.  The  amount  loaned  on  real  estate,  specifying  the  amount 
real  estate,  secured  on  real  estate  in  each  county  separately;  also  specifying 
the  name  of  the  person  in  whose  name  the  property  is  held  in  trust 
or  as  security,  in  case  it  is  held  in  any  name  other  than  that  of  the 
bank  and  the  instrument  creating  the  security  does  not  itself  disclose 
the  name  of  the  bank. 

Bonds.       8,  The  amount  invested  in  bonds,  designating  the  name 
and  amount  of  each  particular  kind. 

Loans  on  bonds.      9.  xhe  amount  loaned  on  stocks  and  bonds,  designating 
each  particular  class  and  the  amount  thereof. 

Loans  on        |0.  The  amount  of  money  loaned  on  other  securities,   with   a 
other  securities,  particular  designation  of  each  class  and  the  amount  loaned  on  each. 

Money)  on  hand.  ]  ] .  fhe  actual  amount  of  money  on  hand  or  deposited  in  any 
other  bank  or  place,  with  the  name  of  the  place  where  deposited 
and  the  amount  in  each  place. 
Other  items.  12.  Any  other  property  held,  or  any  amount  of  money  loaned, 
deposited,  invested  or  placed,  not  otherwise  herein  enumerated,  and 
the  place  where  situate  and  the  value  of  said  property,  and  the 
amount  so  loaned,  deposited  or  placed,  and  any  other  information 
he  may  request  relative  to  the  conduct  and  affairs  of  such  bank. 


BANK   ACT   OF   CALIFORNIA  45 

The  oaths  of  the  officers  and  the  statements  above  required  shall  Report  must  be 
state  that  they  and  each  of  them  have  a  personal  knowledge  of  the  sjvorn  to. 
matters  therein  contained,   and  that   they  believe  every   allegation, 
statement,  matter,  and  thing  therein  contained  is  true.     Any  wilful 
false  statement  in  the  premises  shall  be  perjury  and  shall  be  pun- 
ished as  such. 

Sec.    131.     The  superintendent  of  banks  shall  call  for  reports  Dates  of  reports. 
specified  by  the  previous  section,  at  least  three  times  each  year,  and 
shall  call  for  such  reports  as  near  as  possible  upon  the  same  days 
as  those  designated  by  the  comptroller  of  the  currency  of  the  United 
States  for  reports  of  national  banking  associations. 

Sec.  1 32.  At  the  time  of  furnishing  such  report  to  the  super-  Publication  of 
intendent  of  banks,  every  bank  shall  also  publish  a  condensed  state-  financial 
ment  of  its  financial  condition,  at  least  once,  in  some  newspaper  of  condition. 
general  circulation,  published  in  the  city  or  town  where  its  principal 
place  of  business  is  located,  and,  if  no  paper  is  published  in  such 
town,  then  in  some  newspaper  of  general  circulation  in  the  county 
where  its  principal  place  of  business  is  located.  Such  published 
statement  shall  show  the  total  amount  of  loans,  the  total  amount  of 
overdrafts,  the  total  amount  invested  in  bonds  and  other  securi- 
ties, the  total  amount  due  from  banks,  the  total  amount  of  checks  and 
ot!ier  cash  items,  the  total  amount  of  cash  on  hand,  capital  paid 
in,  surplus  funds;  undivided  profits,  less  expenses  and  taxes  paid; 
due  to  other  banks  and  bankers,  due  to  trust  companies  and  savings 
banks;  individual  deposits  subject  to  checks;  demand  certificates  of 
deposit;  time  deposits;  certified  checks;  cashier's  checks  outstanding; 
and  such  other  items  as  will  show  the  actual  financial  condition  of 
the  bank  making  the  report. 

Sec.    1 33.     Whenever  the  superintendent  of  banks  shall   have  Reduction  of 
reason  to  believe  that  the  capital  of  any  bank  is  reduced  by  impair-  capital  b\) 
ment  or  otherwise  below   the   amount  required   by   law   or   by   its  '^P^"''"^"** 
articles  of  incorporation,  he  may  require  such  bank  to  make  good 
the  deficiency  within  sixty  days  after  the  date  of  such  requisition. 
He  may  examine  or  cause  to  be  examined  any  such  bank  to  ascertain 
the  amount  of  such  impairment  or  reduction  of  capital  and  whether 
the  deficiency  has  been  made  good  as  required  by  him. 


46 N.    W.    HALSEY    &   CO. 

Violations  of  Sec.  134.  If  it  shall  appear  to  the  superintendent  of  banks 
articles  of  that  any  bank  has  violated  its  articles  of  incorporation,  or  any  law 
incorporation,  [jinding  upon  it,  he  must,  by  an  order  under  his  hand  and  official 
seal,  which  seal  must  be  adopted  by  him,  addressed  to  such  bank, 
direct  the  discontinuance  of  such  violation;  or,  if  it  shall  appear 
to  the  superintendent  of  banks  that  such  bank  is  conducting  business 
in  an  unsafe  or  injurious  manner,  he  must  in  like  manner  direct 
the  discontinuance  of  such  unsafe  or  injurious  practices.  Such 
order  shall  require  such  bank  to  show  cause,  before  the  super- 
intendent of  banks,  at  a  time  and  place  to  be  fixed  by  him,  why 
said  order  should  not  be  observed.  If  upon  such  hearing  it  shall 
appear  to  the  superintendent  of  banks  that  such  bank  is  conducting 
business  in  an  unsafe  or  injurious  manner,  or  is  violating  its  articles 
of  incorporation,  or  any  law  of  this  state,  then  the  superintendent 
of  banks  shall  make  such  order  of  discontinuance  final,  and  such 
bank  shall  immediately  discontinue  all  practices  named  in  such 
order  by  the  superintendent  of  banks.  Such  bank  shall  have  ten 
days  after  any  such  order  is  made  final  in  which  suit  may  be  com- 
menced to  restrain  enforcement  of  such  order,  and  unless  such 
action  be  so  commenced  and  enforcement  of  said  order  be  enjoined 
within  ten  days,  by  the  court  in  which  such  suit  is  brought,  then 
such  bank  shall  comply  with  such  order;  and,  in  the  event  of  its 
failure  so  to  do,  then  the  superintendent  of  banks  shall  have  power 
to  take  immediate  charge  and  control  of  said  bank,  and  liquidate  its 
affairs  in  the  manner  provided  in  this  act  for  the  liquidation  of  banks. 

Procedure.  Sec.  135.  In  any  such  action,  no  damage  may  be  awarded, 
but  the  action  otherwise  shall  be  commenced,  tried  and  determined 
according  to  the  provisions  of  the  Code  of  Civil  Procedure  of 
California. 

Superintendent  Sec.    136.     Whenever  the  superintendent  of  banks  shall  have 

of  Banks  to  reason  to  conclude  that  any  bank  is  in  an  unsound  or  unsafe  condi- 

take  charge  of  ^^^  ^^  transact  the  business  for  which  it  is  organized,   or   that  it 

an/fs  in  .           ^^  ^^  inexpedient  for  it  to  continue  business,  the  superintendent 

unsound  ^                                 •         r    i                          i  i_     • 

condition,  of  banks  may  forthwith  take  possession  of  the  property  and  busmess 

of   such   bank,    and   retain    such   possession   until   such   bank   shall 
resume  business,  or  its  affairs  be  finally  liquidated,  as  herein  provided. 


BANK   ACT   OF   CALIFORNIA  47 

On  taking  possession  of  the  property  and  business  of  any  such  Possession  b}) 
bank,   the  superintendent  of   banks   shall    forthwith   give   notice   in  Superintendent 
writing  of  such  fact  to  any  and  all   corporations  and  individuals  of  unsafe  banks. 
holding  or  in  possession  of  any  of  the  assets  of  such  bank. 

No  bank,  corporation  or  individual,  knowing  of  such  taking 
possession  by  the  superintendent  of  banks,  or  notified  as  aforesaid, 
shall  have  a  lien  or  charge  for  any  payment,  advance  or  clearance 
thereafter  made,  or  liability  thereafter  incurred  against  any  of 
the  assets  of  the  bank  of  whose  property  and  business  the  super- 
intendent of  banks  shall  have  taken  possession  as  aforesaid.  Such 
bank  may,  with  the  consent  of  the  superintendent  of  banks,  resume 
business  upon  such  conditions  as  may  be  approved  by  him. 

Upon   taking  possession  of   the   property   and   business  of   such  Liquidation. 
bank,  the  superintendent  of  banks  is  authorized  to  collect  moneys 
due  to  such  bank,  and  to  do  such  other  acts  as  are  necessary  to 
conserve   its    assets    and   business,    and   shall   proceed   to   liquidate 
the  affairs  thereof  as  hereinafter  provided. 

The  superintendent  of  banks  shall  collect  all  debts  due  and 
claims  belonging  to  it,  and  upon  the  order  of  the  superior  court 
may  sell  or  compound  all  bad  or  doubtful  debts,  and  on  like  order 
may  sell  all  real  and  personal  property  of  such  bank  on  such 
terms  as  the  court  shall  direct;  and  may,  if  necessary  to  pay  the 
debts  of  such  bank,  enforce  individual  liability  of  the  stockholders 
by  action  to  be  brought  within  three  years  after  the  date  of  his 
taking  possession   of   the   affairs  of  such   bank. 

The  superintendent  of  banks  may,  under  his  hand  and  official  Special  deputy 
seal,  appoint  one  or  more  special  deputy  superintendents  of  banks,  superintendent. 
as  agent  or  agents,  to  assist  him  in  the  duty  of  liquidation  and 
distribution,  the  certificate  of  appointment  to  be  filed  in  the  office 
of  the  superintendent  of  banks,  and  a  certified  copy  in  the  office 
of  the  clerk  of  the  county  in  which  the  principal  office  of  such 
bank  is  located. 

The  superintendent  of  banks  may,  from  time  to  time,  audiorize 
a  special  deputy  superintendent  to  perform  such  duties  connected 
with  such  liquidations  and  distribution  as  the  superintendent  of 
banks  may  deem  proper.  The  superintendent  of  banks  may  employ 
such  counsel,  and  procure  such  expert  assistance  and  advice  as  Counsel. 
may  be  necessary  in  the  liquidation  and  distribution  of  the  assets 


48 N.    W.    HALSEY    6-   CO. 

of  such  bank,  and  may  retain  such  officers  or  employees  of  such 

bank   as   he   may   deem   necessary.      The   superintendent   of   banks 

shall  require,  from  a  special  deputy  superintendent  and  from  such 

assistants,   such  security   for  the   faithful  discharge   of   their   duties 

as  he  may  deem  proper. 

Claims  against       The  superintendent  of  banks  shall  cause  notice  to  be  given  by 

OOTIDS  in  advertisement  in   such   newspapers   as   he   may   direct,    w^eekly,    for 

^  '  three   consecutive   months,    calling   on    all   persons   v^ho   may   have 

claims  against  such  bank,  to  present  the  same  to  the  superintendent 

of  banks,  and  make  legal  proof  thereof,  at  a  place  and  within  a 

time  not  more  than  six  months  after  the  last  day  of  publication,  to 

be  therein  specified. 

The  superintendent  of  banks  shall  mail  a  copy  of  such  notice 
to  all  persons  whose  names  appear  as  creditors  upon  the  books  of 
the  bank.  If  the  superintendent  of  banks  doubts  the  justice  and 
validity  of  any  claim,  he  may  reject  the  same  and  serve  notice  of 
such  rejection  upon  the  claimant,  either  by  mail  or  personally.  An 
affidavit  of  the  service  of  such  notice  shall  be  prima  facie  evidence 
thereof,  and  shall  be  filed  with  the  superintendent  of  banks.  An 
action  upon  a  claim  so  rejected  must  be  brought  within  six  months 
after  such  service.  Claims  presented  after  the  expiration  of  the 
time  fixed  in  the  notice  to  creditors  shall  be  entitled  to  share  ratably 
in  the  distribution  to  the  extent  of  the  assets  in  the  hands  of  the 
superintendent  of  banks,  equitably  applicable  thereto. 
Inventory  Upon  taking  possession  of  the  property  and  assets  of  such 
of  assets,  bank,  the  superintendent  of  banks  shall  make  an  inventory  of  the 
assets  of  such  bank  in  duplicate,  one  to  be  filed  in  the  office  of  the 
superintendent  of  banks,  and  one  in  the  office  of  the  clerk  of  the 
county  in  which  the  principal  office  of  such  bank  is  located;  upon 
the  expiration  of  the  time  fixed  for  the  presentation  of  claims, 
the  superintendent  of  banks  shall  make  in  duplicate  a  full  and  complete 
list  of  the  claims  presented,  including  and  specifying  such  claims  as 
have  been  rejected  by  him,  one  to  be  filed  in  the  office  of  the  superin- 
tendent of  banks,  and  one  in  the  office  of  the  clerk  of  the  county  in 
which  the  principal  office  of  such  bank  is  located;  such  inventory  and 
list  of  claims  shall  be  open  at  all  reasonable  times  for  inspection. 
Fees.  The  compensation  of  the  special  deputy  superintendents,  counsel, 
and  other  officers   and  assistants,   and   all   expenses  of  supervision 


BANK   ACT   OF   CALIFORNIA 49 

and  liquidation,  shall  be  fixed  by  the  superintendent  of  banks  on 
notice  to  such  bank,  and  shall  upon  his  certificate  be  paid  out 
of  the  funds  of  such  bank  in  his  hands. 

The  sums  collected  by  the  superintendent  of  banks  shall,  from   Deposit  of 
time   to   time,   be   deposited   in   one   or   more   banks   in   this   state,   ("".     ?j  oa^'c* 
subject  to  examination  by  the  superintendent  of  banks.  ^ 

At  any  time  after  the  expiration  of  the  date  fixed  for  the 
presentation  of  claims,  the  superintendent  of  banks  may,  out  of 
the  funds  remaining  in  his  hands  after  the  payment  of  expenses, 
declare  one  or  more  dividends,  and  after  the  expiration  of  one 
year  from  the  date  of  first  publication  of  notice  to  creditors  he 
may  declare  a  final  dividend. 

Objection  to  any  claim  not  rejected  by  the  superintendent  of  Court  to  rule  on 
banks  may  be  made  by  any  party  interested,  by  filing  a  copy  of  such  ^^^P^i^<*  claims. 
objection  with  the  superintendent  of  banks,  who  shall  present  the 
same  to  the  superior  court  of  the  county  in  which  such  bank  has 
its  principal  place  of  business,  with  a  petition  that  said  court  pass 
upon  the  validity  of  such  claims;  and  such  court  shall  thereupon, 
upon  such  notice  to  the  party  presenting  the  same,  and  to  the 
superintendent  of  banks,  as  the  court  may  deem  proper,  accept 
or  reject  said  claim,  and  the  superintendent  of  banks  shall  observe 
the  order  of  the  court  in  that  regard;  provided,  however,  that  should 
the  claim  be  rejected,  such  rejection  shall  not  conclude  the  claimant 
from  bringing  an  action  upon  such  claim  within  six  months  after 
such   rejection. 

Upon  the  petition  of  the  superintendent  of  banks,  such  court 
may  make  proper  provisions  for  unclaimed  deposits. 

Whenever  any  such  bank,  of  whose  property  and  business  the  BarJ^  ma^ 
superintendent  of  banks  has  taken  possession  as  aforesaid,  deems  <^PP^<ii-  io  courts, 
itself  aggrieved  thereby,  it  may  at  any  time  within  ten  days  after 
such  taking  possession,  and  not  thereafter,  apply  to  the  superior 
court  in  the  county  in  which  the  principal  office  of  such  bank  is 
located,  to  enjoin  further  proceedings;  and  said  court,  after  citing 
the  superintendent  of  banks  to  show  cause  why  further  proceedings 
should  not  be  enjoined,  and  upon  hearing  the  allegations  and 
proofs  of  the  parties,  and  determining  the  facts,  may,  upon  the 
merits,    dismiss    such    application,    or   enjoin    the    superintendent   of 


50  N.    W.    HALSEY    &   CO. 

banks  from  further  proceedings,  and  direct  him  to  surrender  such 
business  and  property  to  such  bank. 

Either  party  aggrieved  by  the  judgment  rendered  thereon  may 
appeal  therefrom  to  the  supreme  court,  as  in  other  cases  of  appeal 
thereto  from  the  judgment  of  a  superior  court. 

Appeal  to  ^^  appeal  as  above  provided  shall  operate  as  a  stay  of  the 
supreme  court,  judgment  of  the  superior  court,  and  no  bond  need  be  given  if  the 
appeal  be  taken  by  the  superintendent  of  banks;  but  if  the  appeal 
be  taken  by  such  bank,  a  bond  shall  be  given,  as  required  by  section 
nine  hundred  and  forty-three  of  the  Code  of  Civil  Procedure. 
Final  Whenever  the  superintendent  of  banks  shall  have  paid  to  each 
liquidation,  and  every  depositor  and  creditor  of  such  corporation  (not  including 
stockholders)  whose  claim  or  claims  as  such  creditor  or  depositor 
shall  have  been  duly  approved  and  allowed  the  full  amount  of 
such  claim,  and  shall  have  made  proper  provisions  for  unclaimed 
and  unpaid  deposits  or  dividends,  and  shall  have  paid  all  expenses 
of  the  liquidation,  the  superintendent  of  banks  shall  call  a  meeting 
of  the  stockholders  of  such  corporation  by  giving  notice  thereof 
for  thirty  days,  in  one  or  more  newspapers  published  in  the  county 
where  the  principal  office  of  such  corporation  is  located.  At  such 
meeting,  the  superintendent  of  banks  shall  appear  and  deliver  to 
the  stockholders  all  the  property,  effects  and  records  of  such  bank, 
and  upon  such  transfer  and  delivery  he  shall  be  discharged  from 
any  and  all  further  liability  to  such  bank  and  its  creditors.  And 
thereupon  the  bank  shall  be  in  the  same  position  as  though  it  had 
never  been  authorized  to  transact  a  banking  business,  and  such  bank, 
by  fulfilling  the  requirements  of  this  act,  and  of  the  superintendent 
of  banks,  can  thereafter  be  authorized  to  resume  the  conduct  of 
its  business  as  a  bank. 

Voluntary)       Sec.    137.      1.  Any  bank  shall  have  the  right,  on  application  of 

dissolution  of  t^g  stockholders  or  members  to  apply  to  the  superior  court  of  the 

banlis.  gQuj^ty  y/herein  its  principal  place  of  business  is  situated,  to  dissolve 

said  bank  in  the  manner  provided   for  in  title  six,   part  three  of 

the  Code  of  Civil  Procedure. 

Funds  of       2-   ^*  ^^  hereby  made  the  duty  of  every  person  or  corporation 

dissolved  banks,  holding  funds  of  any  bank,  at  the  end  of  five  years  from  and  after 

such  bank  has  ceased  to  receive  deposits,  or  do  business,  to  pay 


BANK   ACT   OF   CALIFORNIA  51 


the  same  into  the  state  treasury,  which  money  shall  be  held  in 
the  state  school  land  fund;  and  at  the  same  time  it  shall  be  the 
duty  of  such  person  or  corporation  to  furnish  to  the  state  controller 
a  list  of  the  names  of  all  depositors  to  whom  said  moneys  belong 
or  to  whom  said  bank  owes  the  same. 

3.  The  money  may  be  drawn  out  on  the  warrants  of  the  state   ]-Jqq)  much 
controller,  issued  on  proofs  of  ownership,  approved  and  allowed  by    money  may  he 
the  state  board  of  examiners.  drawn. 

4.  All  moneys  paid  into  the  said  fund,  uncalled  for  within  five 
years  after  being  paid  in,  shall  by  operation  of  law,  and  without 
action  had,  escheat  to  the  state,  and  thereafter  only  be  drawn  out 
in  such  manner  as  now  provided  for  by  law  for  the  estates  of 
deceased  persons  escheated  to  this  state. 

5.  The  state  board  of  examiners  must  invest  such  moneys  in  the    Investment 
same  manner  that  the  state  school  land  fund  is  invested  as  provided 

by  law.  But  any  claimant  shall  be  entitled  to  recover  as  herein 
provided  only  the  principal  so  paid  into  the  state  treasury. 

Sec.    1 38.      If  any  bank  shall  fail  to  make  the  report  required  Penali"^  for 
by  law  or  by  the  superintendent  of  banks,  within  ten  days  from  the   delaying  or 
day  designated  for  the  making  thereof,  or  to  include  therein  any   Tifithholding 
matter  required  by  law  or  by  the  superintendent  of  banks,   every   '"^P*"'"' 
such  delinquent  bank  shall   forfeit  to   the  people   of  the  state   the 
sum  of  one  hundred  dollars  for  each  day   that  such  report  shall 
be  delayed  or  withheld,  and  for  every  day  it  shall  fail  to  report 
any  such  omitted  matter.     In  the  event  of  the  failure  of  any  such 
bank  to  make  the  report  required  from  it  by  law,  or  by  the  super- 
intendent of  banks,   he  shall  immediately  cause   the  books,  papers 
and  affairs  of  such  bank  to  be  thoroughly  examined. 

Sec.    1 39.      It  shall  be  the  duty  of  the  board  of  directors  of   Examination  of 
every  bank  to  examine  fully  into  the  books,  papers  and  affairs  of   condition  of 
the  bank  of  which   they   are   directors,    and   particularly   into   the   bank  by 
loans   and   discounts   thereof,   with   a   special   view   to   ascertaining   directors. 
the  value  and  security   thereof,   and  of  the  collateral   security,   if 
any   given,    in   connection   therewith,    and   into   such   other   matters 
as  the  superintendent  of  banks  may  require;  such  examination  to  be 
made  at  least  once  a  year,  but  no  such  subsequent  yearly  examinations 


52  N.    W.    HALSEY    &   CO. 


shall  be  made  within  three  months  of  the  next  preceding  examination. 
Such  directors  shall  have  power  to  employ  such  assistance 
in  making  such  examination  as  they  may  deem  necessary. 
Within  ten  days  after  the  completion  of  such  examination,  a  report 
in  writing  thereof,  sworn  to  by  the  directors  making  the  same,  shall 
be  made  by  the  board  of  directors  of  such  bank,  and  placed  on  file 
with  the  records  of  said  banks,  and  shall  be  subject  to  examination  by 
the  superintendent  of  banks. 
Report  of       Such  report  shall  particularly  contain  a  statement  of  the  assets 

examinations,  and  liabilities  of  the  bank  examined,  as  shown  by  its  books, 
together  with  any  deductions  from  the  assets,  or  additions  to 
liabilities,  which  such  directors  or  committee,  after  such  examination, 
may  determine  to  make.  It  shall  also  contain  a  statement,  in  detail, 
of  loans,  if  any,  which  in  their  opinion  are  worthless  or  doubtful, 
together  with  their  reasons  for  so  regarding  them;  also  a  statement 
of  loans  made  on  collateral  security,  which  in  their  opinion  are 
insufficiently  secured,  giving  in  each  case  the  amount  of  the  loan, 
the  name  and  market  value  of  the  collateral,  if  it  has  any  market 
value,  and,  if  not,  a  statement  of  that  fact,  and  its  actual  value 
as  nearly  as  possible.  Such  report  shall  also  contain  a  statement 
of  overdrafts,  of  the  names  and  amounts  of  such  as  they  consider 
worthless  or  doubtful,  and  a  full  statement  of  such  other  matters 
as  affect  the  solvency  and  soundness  of  the  bank.  If  the  directors 
of  such  bank  shall  fail  to  make,  or  cause  to  be  made,  and  file 
such  report  of  examination  in  the  manner  and  within  the  time 
specified,  the  directors  of  such  bank  shall  be  guilty  of  a  misdemeanor. 
Report  of 

Supermendent       5^^     140,     jhg    superintendent   of   banks   shall    report   during 
07     an/fs   o  ^^  ujQjith  of  October  of  each  year,  to  the  governor,  for  submission 

to  the  next  ensuing  session  of  the  legislature: 
Summary  of  1 .  A  summary  of  the  state  and  condition  of  every  bank  required 
conditions,  to  report  to  him,  and  from  which  reports  have  been  received 
the  preceding  year,  with  an  abstract  of  the  whole  amount  of  capital 
returned  by  them,  the  whole  amount  of  their  debts  and  liabilities, 
and  the  total  amount  of  means  and  resources,  specifying  the  amount 
of  specie  held  by  them  at  the  time  of  the  last  report  to  him,  and 
such  other  information  in  relation  to  such  banks  as,  in  his  judgment, 
may  be  useful. 


BANK   ACT   OF   CALIFORNIA  53 

2.  A  statement  of  all  banks  authorized  by  him  to  do  business  A^en>  ban{[s. 
during    the    previous    year,    with    their    names    and    locations    and 

dates  of  incorporation,   and  particularly  designating  such   as   have 
commenced  business  during  the  year. 

3.  A  statement  of  the  banks   whose  business  has  been   closed  Closed  hanks. 
during  the  year. 

4.  Any  amendments  to  the  banking  law,  which,  in  his  judgment,  Amendmenls. 
may  be  desirable. 

5.  The   names   and   compensation  of   all   persons   employed   by  Pay  roll. 
him,   and  the  whole  amount  of  the  receipts   and  expenses  of  the 
department  during  the  year. 

6.  The    names    of    banks   placed    in   his   hands   in    process    of  Banks  in 
liquidation,  and  the  amount  of  dividends  paid  thereon.  liquidation. 

Such   report,   and   the  usual   number  of   copies   for   the   use  of 
the  legislature,   shall   be  printed   and   in   readiness   for   distribution  '  '"'"""^  of  report. 
by  the  state  printer,  and  one  thousand  copies  shall  be  printed  for 
the  use  of  the  department,  the  expense  of  which  shall  be  charged 
among  the  general  expenses  of  the  department. 

Sec.    141.      I.  The  superintendent  of  banks  shall  keep  in  his  Information  in 
office,  in  a  place  accessible  to  the  general  public,  a  bulletin  board  Superintendent's 
upon  which  he  shall   cause  to  be  posted   at  noon  on   Friday   of  <'£"ce  for  public. 
each  week  a  detailed  statement,  signed  by  him  or,  in  case  of  his 
absence    from   San   Francisco   or   inability   to   act,   by    the   deputy 
superintendent    in    charge,    giving    the    following    items    of    general 
information  with  regard  to  the  work  of  the  department  since  the 
preceding  statement: 

(a)   The   name   of  every  bank   that  has   filed   in   the   banking  [^{^i  q* 
department  an  application  for  authorization  to  commence  business,  applications. 
its  location  and  the  date  of  filing  of  such  application. 

(fc)   The  name  and  location  of  every  bank  authorized  by   the  Authorized 
superintendent  of  banks  to  commence  business,  its  capital,  surplus,  banks. 
and  the  date  of  authorization. 

(c)   The  name  of  every  bank  to  which  a  certificate  of  authoriza-  Banks  refused 
tion  has  been  refused  by  the  superintendent  of  banks,  and  the  date  authorization. 
of  notice  of  refusal. 


^4 N.    W.    HALSEY    &   CO. 

Names  of         (J)   The  name  and  residence  of  every  person  appointed  by  the 

employees,    superintendent  of  banks  as  a  deputy,  examiner  or  employee  in  the 

banking    department,    the    title   of    the   office    to   which    appointed, 

the  compensation  paid,  and  the  date  of  appointment. 

LMils  Jor         ^g^    yj^g   j^jg   Qjj   which    a    call    for    a    report   by   banks    was 

issued  by  the  superintendent  of  banks,  and  the  day  designated 
as  the  day  with  reference  to  which  such  report  should  be  made. 
Liquidated  (/)  The  name  and  location  of  every  bank  whose  creditors  or 
banlis.  depositors  have  been  paid  in  full  by  the  superintendent  of  banks 
and  a  meeting  of  whose  stockholders  shall  have  been  called, 
together   with    date    of   notice    of   meeting    and    date    of   meeting. 

(g)  The  name  and  location  of  every  bank  subject  to  the  banking 
law  whose  affairs  and  business  shall  have  been  finally  liquidated, 
or  in  course  of  liquidation. 
Lhange  of  ^^^  'yhe  name  and  location  of  every  bank  which  has  applied 
for  approval  of  a  change  of  name,  and  the  name  proposed. 
UuUeiins  filed.  2.  Every  such  bulletin,  after  having  been  posted  as  afoiesaid 
for  one  week,  shall  be  placed  on  a  file  for  such  statements,  to  be 
kept  in  the  office  of  the  superintendent  of  banks.  All  such  state- 
ments shall  be  public  documents,  and  at  all  reasonable  times  shall 
be  open  to  public  inspection  during  usual  banking  hours. 

Reports  of  .^^.t-  «••!  111  -i 

Superintendent       SEC.    142.     Every   official   report  made   by   the   supenntendenl 

available  as  and  every  report  duly  verified  of  an  examination  made,  shall  be 

evidence  prima  facie  evidence  of  the  facts  therein  stated,   for  all  purposes 

m  court,  jj^  j^ny  action  or  proceeding  wherein  such  bank  is  a  party. 

Neglect  of       Sec.    1 43.     If  the  superintendent  of  banks  shall  have  knowledge 

o        •  . "  7    7   of  the  insolvency  or  unsafe  condition  of  any  bank  mentioned   in 
Superintendent.    . .  i    1       •    •  r  •  ^•  •        •  1  i      1 

this  act,  and  that  it  is  unsafe  or  inexpedient  to  permit  said  bank 

to  continue  business,  and  shall  neglect  to  forthwith  take  action  as 

provided  in  sections  one  hundred  thirty-three,  one  hundred  thirty- 

»  four,  and  one  hundred  thirty-six  of  this  act,  he  shall  be  guilty  of 

a  felony. 

Penalties  and       Sec.    144.     Whenever  by  the  terms  of  this  act  a  penalty  or 

forfeitures.  fQffgjtu^g   jg   imposed,    the   same   shall   be   recovered   in   an   action 

brought    at    the    request    of   the    superintendent    of    banks    by    the 

attorney   general,    in   the   name   of   the   people   of   the   state,    and 


BANK   ACT   OF   CALIFORNIA 55 

the    sum    recovered    shall    be    paid    into    the    state    banking    fund  Articles  of 
and  used  in  payment  of  claims  against  the  said  fund.  incorporation. 

Sec.    145.     The    powers,     privileges,     duties    and    restrictions 

conferred     and     imposed     upon     any     corporation     or     individual 

existing    and    doing    business    under    the    laws    of    this    state    are 

hereby    abridged,    enlarged    or    modified    as    each    particular    case  p 

may   require,    to   conform   to   the   provisions   of   this   act,    notwith-  transactions 

standing   anything    to   the   contrary    in    their   respective    articles   of  not  affected  b^ 

incorporation  or  charters.     The  legality  of  investments  here-  this  act. 

tofore  made,  or  of  transactions  heretofore  had,  pursuant  to 

any  provisions  of  law  in  force  when  such  investments  were  ^^i  , 

Lnanges  of 

made  or  transactions  had,  shall  not  be  affected  by  the  peo-  investments  to 
visions    of    this    act,    nor    shall    such    provisions    require  conform  ma^  be 
the  changing  of  investments  for  those  named  in  this  act,  gradual. 
except  as  the  same  can  be  done  gradually  by  the  sale  or 
redemption  of  the  securities  so  invested  in,  in  such  manner 
as  to  prevent  loss  or  embarrassment  in  the  business  of  such 
bank,  or  unnecessary  loss  or  injury  to  the  borrowers  on 
such  security. 

Sec.   146.     All   acts,   or   parts  of   acts,   in  conflict  with   this  ^^'^  ^^^'^''^^• 
act  are  hereby  repealed. 

Sec.    147.     This  act  shall  take  effect  July  first,  1909. 


I 


Public  Deposit  Ads  of  California 


STATE    DEPOSIT   ACT 

An  Act  to  Authorize  the  Deposit  of  State  Moneys  in 
Banks  in  this  State,  and  to  Repeal  All  Acts  or 
Parts  of  Acts  in  Conflict  With  This  Act. 

[Approved  February  28,  1907.] 

The  people  of  the  State  of  California,  represented  in  senate  and 
assembly,  do  enact  as  follorvs: 

Section    1.  All  moneys  in  the  state  treasury  belonging  to  the  Deposit  of  state 
state  not  immediately  required   to   meet  current   expenditures   may  moneys  in  hanks. 
be  deposited  by  the  State  treasurer  to   the  credit  of  the  state   in 
such  state  or  national  bank,  or  banks,  in  the  state,  as  the  treasurer, 
with  the  approval  of  the  governor  and  state  controller,  shall  select 
for  the  safe-keeping  of  such  deposits,   and  any  sum  so  deposited 
shall  be  deemed  to  be  in  the  state  treasury;  provided,  that  the  bank 
t    or  banks  in  which  such  money  is  deposited  shall  furnish  security  as  Securit]f. 
hereinafter   provided,    and   provided   further,    that   such    depositary 
bank  or  banks  be  selected  from  those  agreeing  to  pay  the  highest 
rate  of  interest,  not  less  than  two  per  centum  per  annum,  for  such  Interest. 
deposits,  as  may  be  determined  by  bids  to  be  submitted  at  such 
times  and  in  such  manner,  as  the  treasurer,  with  the  approval  of 
the  governor  and  state  controller,  shall  direct;    provided,  that  not  /ifjiount  to  be 
more    than    one-tenth    of    the    aggregate    amount    of    state    moneys  deposited. 
available  for  deposit  and  on  deposit  shall  be  deposited  in  any  one 
bank,   and  provided   further,   that   such    deposit   shall   not   exceed 
twenty-five  per  centum  of  the  paid-up  capital,  exclusive  of  reserve 
and  surplus,  of  any  depositary  bank.     Any  and  all  bids  may  be 
rejected  by  the  treasurer,  with  the  approval  of  the  governor  and 
state  controller,  and  new  bids  asked  for.     The  expense  of  trans-   n^^-^^  gt 
portation  of  moneys  to  and  from  the  state  treasury  to  such  depos-  transporting 
itaries  shall   be  borne  by  such   depositaries.      Said   deposits,    with  moneys. 


Of  Th 

UNiVEP 


58 _^ N.    W.    HALSEY    &   CO. 

interest  thereon,  shall  be  subject  to  withdrawal  at  any  time  upon 
the  demand  of  the  state  treasurer,  or  upon  presentation  of  a  certifi- 
cate of  deposit  properly  indorsed. 

Interest,  when  Sec.  2.  The  interest  to  be  paid  by  any  such  depositary  bank 
payable.  ^}^q\\  jjg  qj^  jj^g  average  daily  balances  of  the  state  moneys  kept  on 
deposit  therewith,  and  shall  be  paid  and  credited  to  the  state 
monthly  on  the  first  day  of  each  and  every  month,  and  such 
interest  shall  accrue  to  the  general  fund  of  the  state  treasury; 
School  moneys.  Provided  that  if  any  moneys  belonging  to  the  state  school  fund  or 
the  state  school  land  fund  shall  at  any  time  be  deposited  under  the 
provisions  of  this  act,  the  interest  received  thereon  shall  be  paid 
into  the  state  school  fund. 

Security  of  Sec.  3.  For  the  security  of  the  funds  deposited  by  the  state 
funds  deposited,  treasurer  under  the  provisions  of  this  act,  there  shall  be 
deposited  with  the  treasurer  bonds  of  the  United  States, 
or  of  this  state,  or  of  any  county,  municipality  or  school 
district  within  this  state,  which  bonds  shall  be  approved 
by  the  governor,  controller  and  treasurer,  to  an  amount 
in  value  at  least  ten  per  centum  in  excess  of  the  amount  of 
the  deposit  with  such  bank  or  banks;  and  if  in  any  case, 
or  at  any  time,  such  bonds  are  not  deemed  satisfactory 
security  to  the  governor,  controller  and  treasurer,  they 
may  require  such  additional  security  as  may  be  satis- 
factory to  them.  Said  bonds  or  any  part  thereof  may  be 
withdrawn  on  the  written  consent  of  the  governor,  con- 
troller and  treasurer;  provided,  that  a  sufficient  amount 
of  said  bonds  to  secure  said  deposits  shall  always  be  kept 
in  the  treasury;  and  in  the  event  that  said  bank  or  banks 
of  deposit  shall  fail  to  pay  such  deposits  or  any  part 
thereof  on  the  demand  of  the  state  treasurer,  or  upon  any 
presentation  of  a  certificate  of  deposit  properly  indorsed, 
then  it  shall  be  the  duty  of  the  state  treasurer  to  forthwith 
convert  said  bonds  into  money  and  to  disburse  the  same 
according  to  law;  provided,  horvever,  that  he  shall  sell 
no  bonds  for  less  than  their  face  value  except  at  public 
sale  after  ten  days'  printed  notice  in  some  newspaper  of 


PUBLIC    DEPOSIT   ACTS    OF    CALIFORNIA S2 

general  circulation  published  in  the  county  where  the  sale 
is  to  take  place. 

Sec.  4.  The  treasurer  shall  take  from  such  depositary  or  depos-  "fovisiom  of 
itaries  a  written  contract,  in  duplicate  setting  forth  the  conditions  and  *'°"  ^^^  ' 
terms  upon  which  the  funds  of  the  state  are  deposited  therewith, 
one  of  which  shall  be  filed  with  the  controller.     One  provision  of 
said  contract  shall  be  that  each  depositary  shall  at  the  end  of  each 
month  render  to  the  treasurer  a  statement  in  duplicate  showing  the 
daily  balances  or  amount  of  money  of  the  state  held  by  it  during 
the  month  and  the  amount  of  the   accrued  interest  thereon  sepa- 
rately, one  of  which  shall  be  filed  by  the  treasurer  with  the  con- 
troller.    The  treasurer  shall  annually  on  the  first  day  of  Tj-Msurer's 
July  furnish  each  depositary  bank  with  a  statement  show-  annual  statement 
ing  the  amount  and  description  of  the  bonds  on  deposit  to  banks. 
with  him  by  such  bank  to  secure  state  deposits. 

Sec.  5.  The  treasurer,  with  the  approval  of  the  governor  Indemnity)  bonds. 
and  controller,  shall,  if  in  his  judgment  it  shall  appear 
necessary  for  the  security  of  the  state,  require  said  banks 
of  deposit  to  give  an  indemnity  bond,  the  sureties  on 
which  shall  not  be  interested  as  stockholders  in  said  bank 
or  banks,  to  be  approved  by  the  governor,  controller  and 
treasurer,  to  secure  the  state  against  loss  by  any  depre- 
ciation in  value  that  may  occur  in  such  bonds  held  by 
him  as  security  for  the  safe-keeping  and  prompt  payment 
of  the  state  moneys  in  such  depositaries. 

Sec.  6.  The  state  treasurer  shall  not  be  responsible  for  any  Treasurer  not 
moneys  deposited  in  a  bank  or  in  banks  under  the  provisions  of  j^^^°"f'  ^ 
this  act  while  the  same  remain  there  deposited  with  the  consent 
of  the  governor  and  controller;  but  the  treasurer  shall  be  charge- 
able with  the  safekeeping,  management  and  disbursement  of  the 
bonds  and  certificates  of  deposit  deposited  with  him  as  security 
for  deposits  of  State  moneys,  and  with  the  interest  thereon,  and 
the  proceeds  of  any  sale  under  the  provisions  of  this  act. 

Sec.    7.   At  the  time  of  depositing  state  moneys  in  any  bank 
designated  as  a  depositary  the  treasurer  shall  take  a  certificate  or 


deposits. 


60  N.    W.    HALSEY    &   CO. 

Certificates  of  certificate   of   deposits   made   payable   to   the   treasurer   of   state   in 

deposit,    such  sum  or  sums  as  he  shall  deem  advisable.     Such  certificate  or 

certificates   of   deposit   in   the   possession   of   the   treasurer   shall   be 

deemed    and   counted   as   cash   by    the    state   board   of   examiners. 

Warrants  paid  Controller's  warrants  drawn  upon  the  state  treasury  may  be  paid 

b}f  certificates,  by    such    certificates    of    deposit    when    properly    indorsed    by    the 

treasurer  the  same  as  in  cash. 

Act  of  1905        Sec.    8.    The   act  of   March   20,    1905,   entitled   "An   act   to 

repealed,  authorize  the  deposit  of  state  moneys  in  banks  in  this  state,   and 

to  repeal  all  acts  or  parts  of  acts  in  conflict  with  this  act,"   and 

all  other  acts  or  parts  of  acts  in  conflict  with  this  act  are  hereby 

expressly  repealed. 


COUNTY  AND  MUNICIPAL  DEPOSIT  ACT. 

An  Act  to  Provide  for  and  Regulate  the  Deposit  of 
County  and  Municipal  Moneys  in  Banks  and  Bank- 
ing Corporations,  Limiting  the  Amount  of  Public 
Moneys  that  May  Be  Deposited  Therein,  and  Pro- 
viding A  Penalty  for  the  Illegal  Deposit  and  Use 
Thereof. 

[Approved  March  23,   1907.] 

The  people  of  the  State  of  California,  represented  in  senate  and 
assembly,  do  enact  as  follows: 

Deposit  of       Section   1.  All    moneys   belonging    to    any    county    or 

public  moneys,   municipality  within  the   state,  may  be  deposited  by  any 

other  than  state,  officer  of   such   county   or   municipality   having   the   legal 

in  tjaniis.  ^^stody  of  such  county  or  municipal  funds  in  any  licensed 

national  bank,  or  banks,  within  this  state,  or  in  any  bank, 

banks   or   corporations   authorized   and  licensed   to   do   a 

banking  business,  and  organized  under  the  laws  of  this 

Security   state,    Provided    that  such  bank  or  banks  in  which  such 

required,   moneys  are  deposited  shall  furnish  as  security  for  such 

deposits,  bonds  of  the  United  States,  or  of  this  state,  or 

of  any  county,  municipality  or  school  district  within  this 


PUBLIC    DEPOSIT    ACTS    OF    CALIFORNIA 61 

state,  approved  by  the  officer  making  the  deposit  and  the 
district  attorney  for  the  county  or  city  attorney  for  the 
municipality  to  which  the  deposit  belongs.  The  market 
value  of  the  bonds  furnished  as  security,  shall  be  at  least 
ten  per  cent  in  excess  of  the  amount  of  the  deposit  secured 
thereby;  but  the  amount  of  the  deposit  shall  in  no  case 
exceed  the  face  value  of  the  bonds  furnished  as  security 
therefor;  and  provided,  that  such  bank,  or  banks,  shall 
pay  a  reasonable  rate  of  interest,  not  less  than  two  per 
cent  per  annum  on  the  daily  balances  therein  deposited. 

Sec.  2.  The  rate  of  interest  shall  be  fixed  annually  as  herein  Rate  of  interest 
provided  in  the  month  of  January  of  each  year  on  all  deposits  to  ^^  "^  fixed,  ivnen. 
be  made  for  such  year;    provided,  that  the  rate  of  interest  for  the 
year  ending  December  31st,    1907,  may  be  fixed  as  herein  pro- 
vided within  ninety  days  after  this  act  goes  into  effect.     The  rate 
of  interest  shall  be  fixed  in  the  case  of  counties,  by  the  treasurer, 
auditor,  and  chairman  of  the  board  of  supervisors,  and  in  the  case 
of  municipalities   by   the   treasurer,   auditor,    (or   clerk   of   munici- 
palities having  no  auditor)    and  chairman  of  the  council  or  other 
governing  body  of  such  municipality.     Said  rate  of  interest  shall  J[{ifi{fjmfn  fate. 
be  a  reasonable  rate  and  not  less  than  two  per  cent  per  annum 
on  the  daily  balances  deposited;    and  the  rate  of  interest  so  estab- 
lished for  each  year  as  herein  provided,  shall  be  the  uniform  rate 
of    interest   required    from   all   banks   receiving   deposits    from    the 
county  or  municipality,  for  that  year. 

Interest  on   all   moneys  deposited   as  herein   provided   for  shall  Interest,  "Ofhen 
belong   to   the   county    or   municipality    represented   by    the   officer  payable. 
making  such  deposit  and  shall  be  paid  quarterly  into  the  general 
fund  of  such  county  or  municipality  except  where  the  law  other- 
wise directs. 

Sec.  3.  It  shall  be  the  duty  of  the  officer  making  the  deposit.   Receipt  for 
to  receive  from  the  bank  in  which  the  deposit  is  made,  a  receipt  deposit. 
or  receipts  in  duplicate  showing  the  date  and  amount  of  deposit 
and    rate    of    interest    to    be    paid    thereon,    one    copy    of    which 
said  officer  shall  keep  on  file  in  his  office  and  he  shall  file  one  copy 


62  N.    W.    HALSEY    &   CO. 

with  the  auditor  of  the  county  or  auditor  of  the  municipality   (or 
clerk  in  municipalities  having  no  auditor)   as  the  case  may  be. 

Record  of       Sec.  4.  Every  treasurer  shall  keep  a  record  in  his  office  which 

deposits,  shall  be  open  to  public  inspection,  showing  at  all  times  the  amount 

of  money  on  deposit  and  all  banks  in  which  the  same  is  deposited, 

and  dates  of  deposit.     Also  a  record  of  all  banks  making  application 

for  the  deposit  of  the  public  funds. 

Amount  that  Sec.  5.  The  total  amount  of  public  moneys  on  deposit  in  any 
ma\)  be  bank,  shall  not  at  any  one  time  exceed  fifty  per  cent  of  the  paid-up 
deposited,  capital  stock  of  such  depositary  bank  or  banks.  No  officer  shall 
have  on  deposit  at  any  one  time  more  than  ten  per  cent  of  the 
public  moneys  under  his  control  and  available  for  deposit  in  any 
bank  while  there  are  other  qualified  banks  requesting  such  deposits; 
provided,  that  no  treasurer  of  a  county,  or  municipality,  shall  be 
required  to  deposit  public  moneys  in  any  bank  outside  of  the  county 
owning  the  money  or  in  which  the  municipality  is  situated. 

Receipts  to  he       Sec.    6.    The   receipt  issued   by   any   bank   for   deposits   made 

counted  as  cash,  therein,  together  with  the  bonds  held  as  security  therefor,  shall  be 

held  by  the  treasurer  making  the  deposit  and  be  recognized  and 

counted  as  cash  to  the  amount  recited  in  the  receipt  by  the  officers 

required  by  law  to  count  the  same. 

Deposits  subject  Sec.  7.  Deposits,  with  interest  thereon,  shall  be  subject 
to  call,  to  withdrawal  on  demand  of  the  treasurer  making  the 
same,  or  his  successors  in  office,  and  any  bank  receiving 
the  deposit  of  public  moneys,  may  at  any  time  return  the 
same  to  the  public  officer  making  such  deposit,  together 
with  interest  to  date  of  return,  and  it  shall  be  the  duty 
of  the  public  officer  upon  receiving  the  return  of  such 
deposit,  to  immediately  return  to  such  bank  all  bonds  held 
as  security  for  the  deposit  returned. 

When  any  officer  withdraws  his  deposit  he  shall  return, 
on  demand  of  the  bank,  such  bonds  as  were  held  as 
security  for  the  deposit  or  portion  thereof  withdrawn. 

On  fadure  of  Sec.  8.  Should  any  bank  fail  to  pay  any  public  moneys 
anii  0  repa^,  j^^j^  ^^  deposit  as  herein  provided,  the  officer  making  such 
security  to  be    ^  ,         ^        ^  ,       ,        .  .  ,    ,       , 

sold    deposit  may,  after  ten  days    written  notice  to  such  bank, 


PUBLIC    DEPOSIT    ACTS    OF    CALIFORNIA  63 

proceed  to  sell  at  public  or  private  sale,  such  of  the  bonds 
held  by  him  as  security  as  he  may  see  fit;  provided, 
however,  that  he  shall  sell  no  bonds  for  less  than  their 
face  value  except  at  public  sale  after  ten  days'  printed 
notice  in  some  newspaper  of  general  circulation  published 
in  the  county  where  the  sale  is  to  take  place.  The  pro- 
ceeds of  such  sale,  after  paying  all  expenses,  shall  be 
credited  to  the  account  of  the  bank  which  deposited  the 
bonds  as  collateral.  Any  bank  failing  to  make  payment, 
may,  at  any  time  before  the  sale  of  the  bonds  is  com- 
pleted, stop  such  sale  by  repaying  all  the  moneys  deposited 
with  it,  together  with  any  expense  that  may  have  been 
incurred  by  the  officer  making  such  deposit,  as  the  result 
of  such  failure.  Should  the  proceeds  of  any  such  sale  fail  to 
fully  repay  any  deposit,  the  balance  remaining  unpaid  may 
be  collected  in  an  action  of  law  in  the  name  of  the  officer 
making  the  deposit. 

Sec.  9.   Public  officials  shall  not  be  responsible  for  any  loss  of  p„iL/,v  oihcials 
public  moneys   resulting   from   the   deposit   thereof  when   made   in  not  responsible 
accordance  with  the  provisions  of  this  act.      It  shall  be  the  duty  for  loss. 
of  the  officer  making  the  deposit  to  safely  keep   all  evidence   of 
indebtedness  issued  by  banks  for  deposits  made  therein,  and  bonds 
deposited  for  security  and  such  public  officer  shall  be  responsible 
for  such  evidence  of  indebtedness,  and  for  bonds  held  as  security 
therefor,  together  with  the  interest  thereon  and  the  proceeds  of  any 
sale  of  such  bonds;    and  the  city,  county  or  municipality  for  which 
said  officer  acts,   shall   be  responsible   to  such  bank   for   the  safe 
return  of  the  securities  furnished  by  it  to  such  officer. 

Sec.   10.  The  expenses  of  transportation  of  moneys  to  or  from  Transtoortation 
the  state,  county  or  municipal  treasuries  to  such  depositaries  shall  of  moneys, 
be  borne  by  such  depositaries. 

Sec.    1 1 .  The  making  of  profit  out  of  county,  city,  town  or  yiolaiion  of  act 
other  public  moneys,  or  using  the  same  for  any  purpose  not  author-  a  felon}f. 
ized  by  law  by  any  officer  having  possession  or  control  thereof, 
shall  be  a  felony.     Any  violation  of  the  provisions  of  this  act  by 
a  bank  or  a  banking  corporation,  shall  be  punishable  by  a  fine  not 
exceeding  five  hundred  dollars   for  each   offense,   and  the  officers 


64  N.    W.    HALSEY    &   CO. 

Present  lal)>s  ^^   such   bank   or   banking   corporation   and   officer   receiving   such 
not  abrogated,  deposit  shall  be  guilty  of  a  felony. 

Sec.  12.  Nothing  in  this  act  contained  shall  prevent  any 
county  or  municipality  within  this  state  from  buying 
bonds  or  otherwise  investing  its  money  in  any  manner 
now  provided  by  law  and  nothing  herein  contained  as  to 
the  disposition  of  interest  on  public  moneys  deposited  shall 
apply  to  any  money  received  or  held  by  any  county  or 
municipality  wherein  any  law  provides  for  the  payment 
of  interest  or  profit  thereon,  into  any  particular  fund. 

Sec.  13.  All  acts  or  parts  of  acts  in  conflict  with  this  act  are 
hereby  repealed. 

Sec.    14.  This  act  shall  take  effect  immediately. 


National  Bank  Act  as  Amended 


Chapter  One. 
THE  CURRENCY  BUREAU. 

1.  Sec.    1   of  the  act  of  June  20,    1874,  provides  that  the  act  The 
entitled  "An  act  to  provide  a  national  currency  secured  by  a  pledge  national-bank 
of   United   States   bonds,   and   to   provide   for   the   circulation   and  '^^^^ 
redemption   thereof,"    approved   June   third,   eighteen   hundred   and 

sixty-four,   shall  hereafter  be  known   as   the   "National-bank  act." 

2.  (Sec.    324.)    There    shall    be    in    the    Department    of    the    Comptroller  of 
Treasury  a  Bureau  charged  with  the  execution  of  all  laws  passed    the  Currency. 
by   Congress   relating    to   the    issue    and    regulation   of   a   national 

currency  secured  by  United  States  bonds,  the  chief  officer  of  which 
Bureau  shall  be  called  the  Comptroller  of  the  Currency,  and  shall 
perform  his  duties  under  the  general  direction  of  the  Secretary  of 
the  Treasury. 

3.  (Sec.  325.)  The  Comptroller  of  the  Currency  shall  be  His  appointment, 
appointed  by  the  President,  on  the  recommendation  of  the  Secretary  term,  and  salary. 
of  the  Treasury,  by  and  with  the  advice  and  consent  of  the  Senate, 

and  shall  hold  his  office  for  the  term  of  five  years,  unless  sooner 
removed  by  the  President,  upon  reasons  to  be  communicated  by 
him  to  the  Senate;  and  he  shall  be  entitled  to  a  salary  of  five 
thousand  dollars  a  year. 

4.  (Sec.  326.)  The  Comptroller  of  the  Currency  shall,  within  //^  qualification. 
fifteen  days  from  the  time  of  notice  of  his  appointment,  take  and 

subscribe  the  oath  of  office;  and  he  shall  give  to  the  United 
States  a  bond  in  the  penalty  of  one  hundred  thousand  dollars, 
with  not  less  than  two  responsible  sureties,  to  be  approved  by  the 


66  N.    W.    HALSEY    &   CO. 


Secretary  of  the  Treasury,  conditioned  for  the  faithful  discharge  of 
the  duties  of  his  office. 

Deputy;  5.  (Sec.  327.)  There  shall  be  in  the  Bureau  of  the  Comp- 
comptroUer.  troller  of  the  Currency  a  Deputy  Comptroller  of  the  Currency,  to 
be  appointed  by  the  Secretary,  who  shall  be  entitled  to  a  salary 
of  two  thousand  eight  hundred  dollars  a  year  (increased  to  three 
thousand  five  hundred  dollars),  and  who  shall  possess  the  power 
and  perform  the  duties  attached  by  law  to  the  office  of  Comptroller 
during  a  vacancy  in  the  office  or  during  the  absence  or  inability 
of  the  Comptroller.  The  Deputy  Comptroller  shall  also  take  tlie 
oath  of  office  prescribed  by  the  Constitution  and  laws  of  the 
United  States,  and  shall  give  a  like  bond  in  the  penalty  of  fifty 
thousand  dollars. 

Interest  in       6.    (Sec.  329.)      It  shall  not  be  lawful  for  the  Comptroller  or 
national  banks  t^g  Deputy  Comptroller  of  the  Currency,  either  directly  or  indirectly, 
'  to  be  interested  in  any  association  issuing  national  currency  under  the 
laws  of  the  United  States. 

Oj^ce  clerks.  7.  (Sec.  328.)  The  Comptroller  of  the  Currency  shall  employ, 
from  time  to  time,  the  necessary  clerks,  to  be  appointed  and  classified 
by  the  Secretary  of  the  Treasury,  to  discharge  such  duties  as  the 
Comptroller  shall  direct. 

Seal  of  office.  8.  (Sec.  330.)  The  seal  devised  by  the  Comptroller  of  the 
Currency  for  his  office,  and  approved  by  the  Secretary  of  the 
Treasury,  shall  continue  to  be  the  seal  of  office  of  the  Comptroller, 
and  may  be  renewed  when  necessary.  A  description  of  the  seal, 
with  an  impression  thereof,  and  a  certificate  of  approval  of  the 
Secretary  of  the  Treasury,  shall  be  filed  in  the  office  of  the 
Secretary  of  State. 

Officers,  9.  (Sec.  331.)  There  shall  be  assigned,  from  time  to  time,  to 
vaults,  etc.  the  Comptroller  of  the  Currency,  by  the  Secretary  of  the  Treasury, 
suitable  rooms  in  the  Treasury  building  for  conducting  the  business 
of  the  Currency  Bureau,  containing  safe  and  secure  fireproof  vaults, 
in  which  the  Comptroller  shall  deposit  and  safely  keep  all  the 
plates  not  necessarily  in  the  possession  of  engravers  or  printers,  and 
other  valuable  things  belonging  to  his  department;  and  the  Comp- 
troller   shall    from    time    to    time    furnish    the    necessary    furniture. 


NATIONAL    BANK    ACT  67 

stationery,    fuel,    lights,    and    other    proper    conveniences    for    tlie 
transaction  of  the  business  of  his  office. 

10.  (Sec.  333.)   The  Comptroller  of  the  Currency  shall  make  Annual  report. 
an  annual  report  to  Congress,  at  the  commencement  of  its  session, 

exhibiting — 

First.  A  summary  of  the  state  and  condition  of  every  asso-  Condition  of 
ciation  from  which  reports  have  been  received  the  preceding  year,  national  banlis. 
at  the  several  dates  to  which  such  reports  refer,  with  an  abstract 
of  the  whole  amount  of  banking  capital  returned  by  them,  of  the 
whole  amount  of  their  debts  and  liabilities,  the  amount  of  circu- 
lating notes  outstanding,  and  the  total  amount  of  means  and 
resources,  specifying  the  amount  of  lawful  money  held  by  them 
at  the  times  of  their  several  returns,  and  such  other  information  in 
relation  to  such  associations  as  in  his  jugdment  may  be  useful. 

Second.  A    statement    of    the    associations    whose    business    has   Closed  banks. 
been  closed  during  the  year,  with  the  amount  of  their  circulation 
redeemed  and  the  amount  outstanding. 

Third.  Any    amendment    to    the    laws    relative    to    banking    by   Amendments 
which  the  system  may  be  improved  and  the  security  of  the  holders  proposed. 
of  its  notes  and  other  creditors  may  be  increased. 

Fourth.  A  statement  exhibiting  under  appropriate  heads  the  Condition  of 
resources  and  liabilities  and  condition  of  the  banks,  banking  com-  other  ban^s. 
panies,  and  savings  banks  organized  under  the  laws  of  the  several 
States  and  Territories,  such  information  to  be  obtained  by  the 
Comptroller  from  the  reports  made  by  such  banks,  banking  com- 
panies, and  savings  banks  to  the  legislatures  or  officers  of  the 
different  States  and  Territories,  and,  where  such  reports  can  not 
be  obtained,  the  deficiency  to  be  supplied  from  such  other  authentic 
sources  as  may  be  available. 

Fifth.  The  names  and  compensation  of  the  clerks  employed  by   Employees  and 
him,  and  the  whole  amount  of  the  expenses  of  the  banking  depart-    expenses, 
ment  during  the  year. 

11.  (Sec.  3811.)   When  the  Annual  Report  of  the  Comptroller    When  annual 
of  the  Currency  upon  the  national  banks  and  banks  under  State    report  is  printed. 
and   Territorial   laws   is   completed,    or   while    it   is    in   process   of 

completion,  if  thereby  the  business  may  be  sooner  dispatched,  the 


68  N.    W.    HALSEY    &   CO. 

work  of  printing  shall  be  commenced,  under  the  superintendence  of  the 
Secretary,  and  the  whole  shall  be  printed  and  ready  for  delivery 
on  or  before  the  first  day  of  December  next  after  the  close  of  the 
year  to  which  the  report  relates. 

Number  of        12.   The  act  of  January   12,   1895,  provides  that  there  shall  be 

copies  to  be  printed  of  the  Annual  Report  of  the  Comptroller  of  the  Currency 

prmtea.   ^^^  thousand  copies;  one  thousand  for  the  Senate,  two  thousand  for 

the  House,  and  seven  thousand  for  distribution  by  the  Comptroller 

of  the  Currency. 

Chapter  Two. 

ORGANIZATION  AND  POWERS  OF  NATIONAL 

BANKS. 

Articles  of  l^-  (Sec.  5133.)  Associations  for  carrying  on  the  business  of 
association,  banking  under  this  title  may  be  formed  by  any  number  of  natural 
persons,  not  less  in  any  case  than  five.  They  shall  enter  into 
articles  of  association,  which  shall  specify  in  general  terms  the 
object  for  which  the  association  is  formed,  and  may  contain  any 
other  provisions,  not  inconsistent  with  law,  which  the  association 
may  see  fit  to  adopt  for  the  regulation  of  its  business  and  the 
conduct  of  its  affairs.  These  articles  shall  be  signed  by  the 
persons  uniting  to  form  the  association,  and  a  copy  of  them  shall 
be  forwarded  to  the  Comptroller  of  the  Currency,  to  be  filed  and 
preserved   in  his  office. 

Organization        14.    (Sec.  5134.)     The  persons  uniting  to  form  such  an  asso- 
certificate.   ciation   shall,   under  their  hands,   make   an  organization  certificate, 
which  shall  specifically  state — 

Title.        First.      The  name  assumed  by  such  association;    which  shall  be 
subject  to  the  approval  of  the  Comptroller  of  the  Currency. 

Location.  Second.  The  place  where  its  operations  of  discount  and  deposit 
are  to  be  carried  on,  designating  the  State,  Territory,  or  District,  and 
the  particular  county  and  city,  town  or  village. 

Capital  stock.        Third.      The  amount  of  capital  stock  and  the  number  of  shares 
into  which  the  same  is  to  be  divided. 


NATIONAL    BANK   ACT ^ 

Fourth.     The  names  and  places  of  residence  of  the  shareholders   Shareholders. 
and  the  number  of  shares  held  by  each  of  them. 

Fifth.     The    fact   that   the   certificate   is   made   to   enable   such   Object  of 
persons  to  avail  themselves  of  the  advantages  of  this  Title.  cerhjicale. 

15.  (Sec.  5135.)   The  organization  certificate  shall  be  acknowl-  Execution  of 
edged  before  a  judge  of  some  court  of  record  or  notary  public,    organization 
and  shall  be,  together  with  the  acknowledgment  thereof,   authenti-   ^^rlijicate. 
cated  by  the  seal  of  such  court  or  notary,  transmitted  to  the  Comp- 
troller of  the  Currency,  who  shall  record  and  carefully  preserve  the 

same  in  his  office. 

16.  (Sec.    5136.)   Upon   duly   making   and   filing   articles   of   Corporate 
association    and    an    organization    certificate,    the    association    shall   poJ^c*** 
become,    as    from    the   date   of    the   execution   of    its    organization 
certificate,  a  body  corporate,  and  as  such,  and  in  the  name  desig- 
nated in  the  organization  certificate,  it  shall  have  power — 

First.     To  adopt  and  use  a  corporate  seal.  Seal. 

Second.     To  have  succession  for  the  period  of  twenty  years  from    Term  of 
its  organization,  unless  it  is  sooner  dissolved  according  to  the  provisions   existence. 
of  its  articles  of  association,  or  by  the  act  of  its  shareholders  owning 
two-thirds  of  its  stock,  or  unless  its  franchise  becomes  forfeited  by 
some  violation  of  law. 

Third.     To  make  contracts.  Contracts. 

Fourth.     To  sue   and   be  sued,   complain   and   defend,   in   any    Suits. 
court  of  law  and  [or]  equity,  as  fully  as  natural  persons. 

Fifth.      To  elect  or  appoint  directors,  and  by  its  board  of  directors    Officers. 
to   appoint   a   president,   vice-president,   cashier,    and   other   officers, 
define  their  duties,  require  bonds  of  them  and  fix  the  penalty  thereof, 
dismiss  such  officers  or  any  of  them  at  pleasure,  and  appoint  others 
to  fill  their  places. 

Sixth.     To   prescribe,    by   its   board   of   directors,    by-laws    not    By^-Lants. 
inconsistent  with  law,  regulating  the  manner  in  which  its  stock  shall 
be  transferred,  its  directors  elected  or  appointed,  its  officers  appointed, 
its   property    transferred,    its    general    business    conducted,    and    the 
privileges  granted  to  it  by  law  exercised  and  enjoyed. 


70 N.    W.    HALSEY    &   CO. 

Incidental  Seventh.  To  exercise  by  its  board  of  directors,  or  duly  authorized 
powers,  officers  or  agents,  subject  to  law,  all  such  incidental  powers  as  shall 
be  necessary  to  carry  on  the  business  of  banking ;  by  discounting  and 
negotiating  promissory  notes,  drafts,  bills  of  exchange,  and  other 
evidences  of  debt;  by  receiving  deposits;  by  buying  and  selling 
exchange,  coin,  and  bullion;  by  loaning  money  on  personal  security; 
and  by  obtaining,  issuing,  and  circulating  notes  according  to  the 
provisions  of  this  Title;  but  no  association  shall  transact  any  business 
except  such  as  is  incidental  and  necessarily  preliminary  to  its  organ- 
ization until  it  has  been  authorized  by  the  Comptroller  of  the  Cur- 
rency to  commence  the.  business  of  banking. 

Amount  of  17.  (Sec.  5138,  as  amended  by  act  of  March  14,  1900.)  No 
Capital  stock  association  shall  be  organized  with  a  less  capital  than  one  hundred 
required,  thousand  dollars,  except  that  banks  with  a  capital  of  not  less  than 
fifty  thousand  dollars  may,  with  the  approval  of  the  Secretary  of 
the  Treasury,  be  organized  in  any  place  the  population  of  which 
does  not  exceed  six  thousand  inhabitants,  and  except  that  banks 
with  a  capital  of  not  less  than  twenty-five  thousand  dollars  may, 
with  the  sanction  of  the  Secretary  of  the  Treasury,  be  organized 
in  any  place  the  population  of  which  does  not  exceed  three  thousand 
inhabitants.  No  association  shall  be  organized  in  a  city  the  popu- 
lation of  which  exceeds  fifty  thousand  persons  with  a  capital  of 
less  than  two  hundred  thousand  dollars. 

Shares  of  stock.  1  8-  (Sec.  5  1  39.)  The  capital  stock  of  each  association  shall  be 
divided  into  shares  of  one  hundred  dollars  each,  and  be  deemed  per- 
sonal property,  and  transferable  on  the  books  of  the  association  in  such 
manner  as  may  be  prescribed  in  the  by-laws  or  articles  of  association. 
Every  person  becoming  a  shareholder  by  such  transfer  shall,  in  propor- 
tion to  his  shares,  succeed  to  all  the  rights  and  liabilities  of  the  prior 
holder  of  such  shares. 

Payment  of        19.    (Sec.   5140.)    At   least    fifty    per    centum    of    the    capital 
capital  slock,   stock  of  every  association  shall  be  paid  in  before  it  shall  be  author- 
ized to  commence  business;    and  the  remainder  of  the  capital  stock 
of   such   association   shall   be   paid   in   installments   of   at  least   ten 
per  centum  each,  on  the  whole  amount  of  the  capital,  as  frequently 


NATIONAL    BANK    ACT 71 

as  one  installment  at  the  end  of  each  succeeding  month  from  the 
time  it  shall  be  authorized  by  the  Comptroller  of  the  Currency  to 
commence  business;  and  the  payment  of  each  installment  shall  be 
certified  to  the  Comptroller,  under  oath,  by  the  president  or  cashier 
of  the  association. 

20.  (Sec.  5141.)     Whenever  any  shareholder,  or  his  assignee.  Enforcing 
fails  to  pay  any  installment  on  the  stock  when  the  same  is  required  payment  of 
by  the  preceding  section  to  be  paid,  the  directors  of  such  association  ''^^'  '^  ' 
may  sell  the  stock  of  such  delinquent  shareholder  at  public  auction, 

having  given  three  weeks'  previous  notice  thereof  in  a  newspaper 
published  and  of  general  circulation  in  the  city  or  county  where 
the  association  is  located,  or  if  no  newspaper  is  published  in  said 
city  or  county,  then  in  a  newspaper  published  nearest  thereto,  to 
any  person  who  will  pay  the  highest  price  therefor,  to  be  not  less 
than  the  amount  then  due  thereon,  with  the  expenses  of  adver- 
tisement and  sale;  and  the  excess,  if  any,  shall  be  paid  to  the 
delinquent  shareholder.  If  no  bidder  can  be  found  who  will  pay 
for  such  stock  the  amount  due  thereon  to  the  association,  and  the 
cost  of  advertisement  and  sale,  the  amount  previously  paid  shall 
be  forfeited  to  the  association,  and  such  stock  shall  be  sold  as  the 
directors  may  order,  within  six  months  from  the  time  of  such 
forfeiture,  and  if  not  sold  it  shall  be  canceled  and  deducted  from 
the  capital  stock  of  the  association. 

21.  (Sec.   5141.)    If  any  such  cancellation  and  reduction  shall  Restoration  of 
reduce  the  capital  of  the  association  below  the  minimum  of  capital  capital. 
required  by  law,   the  capital  stock  shall,   within   thirty  days   from 

the  date  of  such  cancellation,  be  increased  to  the  required  amount; 
in  default  of  which  a  receiver  may  be  appointed,  according  to  the 
provisions  of  section  fifty-two  hundred  and  thirty-four,  to  close  up 
the  business  of  the  association. 

22.  (Sec.  5168.)     Whenever  a  certificate  is  transmitted  to  the  Examination   of 
Comptroller  of   the   Currency,   as  provided   in   this   Title,   and   the  organization 
association   transmitting   the   same   notifies    the   Comptroller   that   at  P''ocee</mgs. 
least  fifty  per  centum  of  its  capital  stock  has  been  duly  paid  in, 

and  that  such  association  has  complied  with  all  the  provisions  of 
this  Title  required  to  be  complied  with  before  an  association  shall 


72  N.    W.    HALSEY    &   CO. 


be  authorized  to  commence  the  business  of  banking,  the  Comptroller 
shall  examine  into  the  condition  of  such  association,  ascertain 
especially  the  amount  of  money  paid  in  on  account  of  its  capital, 
the  name  and  place  of  residence  of  each  of  its  directors,  and  the 
amount  of  the  capital  stock  of  which  each  is  the  owner  in  good 
faith,  and  generally  whether  such  association  has  complied  with 
all  the  provisions  of  this  Title  required  to  entitle  it  to  engage  in 
the  business  of  banking. 

Certificate  of       23.    (Sec.   5168.)   And  shall  cause  to  be  made  and  attested 

officers  and  by  the  oaths  of  a  majority  of  the  directors,  and  by  the  president 

directors.   ^^  cashier  of  the  association,  a  statement  of  all  the  facts  necessary 

to  enable  the  Comptroller  to  determine  whether  the   association   is 

lawfully  entitled  to  commence  the  business  of  banking. 

Deposit  of  24.  (Sec.  5159.)  Every  association,  after  having  complied 
United  States  with  the  provisions  of  this  Title,  preliminary  to  the  com- 
bonds.  mencement  of  the  banking  business,  and  before  it  shall 
be  authorized  to  commence  banking  business  under  this 
Title,  _shaU_transfer  and  deliver  to  jth-C  Treasurer  of  the 
United  States,  as  security  for  its  circulating  notes,  any 
United  States  registered  bonds  bearing  interest,  to  an 
amount  where  the  capital  is  one  hundred  and  fifty  thousand 
dollars  or  less,  of  not  less  than  one-fourth  of  the  capital, 
and  fifty  thousand  dollars  where  the  capital  is  in  excess 
of  one  hundred  and  fifty  thousand  dollars.  (Note. — As 
amended  by  sec.  8  of  the  act  of  July  12,  1882.) 

Comptroller's  25.  (Sec.  5169.)  If,  upon  a  careful  examination  of  the  facts 
certificate  of  so  reported,  and  of  any  other  facts  which  may  come  to  the  knowl- 
authorit^.  ^jg^  ^f  jj^g  Comptroller,  whether  by  means  of  a  special  com- 
mission appointed  by  him  for  the  purpose  of  inquiring  into  the 
condition  of  such  association,  or  otherwise,  it  appears  that  such 
association  is  lawfully  entitled  to  commence  the  business  of  banking, 
the  Comptroller  shall  give  to  such  association  a  certificate,  under  his 
hand  and  official  seal,  that  such  association  has  complied  with  all 
the  provisions  required  to  be  complied  with  before  commencing  the 
business  of  banking,  and  that  such  association  is  authorized  to 
commence  such  business.  But  the  Comptroller  may  withhold  from 
an    association    his    certificate    authorizing    the    commencement    of 


NATIONAL    BANK    ACT 73 

business  whenever  he  has  reason  to  suppose  that  the  shareholders 
have  formed  the  same  for  any  other  than  the  legitimate  objects 
contemplated  by  this  Title. 

26.      (Sec.  5170.)      The  association  shall  cause  the  certificate  Publication  of 
issued  under  the  preceding  section  to  be  published  in  some  news-  certificate  of 
paper  printed  in  the  city  or  county  where  the  association  is  located,  ^  ^' 

for  at  least  sixty  days  next  after  the  issuing  thereof;  or,  if  no 
newspaper  is  published  in  such  city  or  county,  then  in  the  news- 
paper published  nearest  thereto. 


27.  (Sec.   5145.)      The  affairs  of  each  association  shall  be  Numher  and 

managed  by  not  less  than  five  directors,  who  shall  be  elected  by  ^'5^"^"  °i 

clircctoTs 
the  shareholders  at  a  meeting  to  be  held  at  any  time  before  the 

association   is  authorized  by   the   Comptroller  of   the  Currency   to 

commence  the  business  of  banking,  and  afterward  at  meetings  to  be 

held  on  such  day  in  January  of  each  year  as  is  specified  therefor  in 

the  articles  of  association.     The  directors  shall  hold  office  for  one 

year,  and  until  their  successors  are  elected  and  have  qualified. 

28.  (Sec.  5146.    as   amended   February   28,    1905.)     Every  Qualifications  of 
director  must,  during  his  whole  term  of  service,  be  a  citizen  of  the  """actors. 
United  States,  and  at  least  three-fourths  of  the  directors  must  have 

resided  in  the  State,  Territory,  or  District  in  which  the  association 
is  located  for  at  least  one  year  immediately  preceding  their  election, 
and  must  be  residents  therein  during  their  continuance  in  office. 
Every  director  must  own,  in  his  own  right,  at  least  ten  shares  of 
the  capital  stock  of  the  association  of  which  he  is  a  director,  unless 
the  capital  of  the  bank  shall  not  exceed  twenty-five  thousand 
dollars,  in  which  case  he  must  own  in  his  own  right  at  least  five 
shares  of  such  capital  stock.  Any  director  who  ceases  to  be  the 
owner  of  the  required  number  of  shares  of  the  stock,  or  who 
becomes  in  any  other  manner  disqualified,  shall  thereby  vacate  his 
place. 

29.  Sec.    17  of  the  act  of  May  2,    1 890,  provides  "that  the  Qualifications  of 
provisions  of  Title  sixty-two  of  the  Revised  Statutes  of  the  United  directors  in 
States  relating  to  national  banks,  and  all  amendments  thereto,  shall  ^'c'Q"oma. 
have  the  same  force  and  effect  in  the  Territory  of  Oklahoma  as 

elsewhere  in  the  United  States: 


74  N.    W.    HALSEY    &   CO. 

" Provided t  That  persons  otherwise  qualified  to  act  as  directors 
shall  not  be  required  to  have  resided  in  said  Territory  for  more 
than  three  months  immediately  preceding  their  election  as  such." 

Qualifications  of  30.  (Sec.  5144.)  In  all  elections  of  directors,  and  in  deciding 
voters  at  j^j|  questions  at  meetings  of  shareholders,  each  shareholder  shall  be 
entitled  to  one  vote  on  each  share  of  stock  held  by  him.  Share- 
holders may  vote  by  proxies  duly  authorized  in  writing;  but  no 
officer,  clerk,  teller,  or  bookkeeper  of  such  association  shall  act  as 
proxy;  and  no  shareholder  whose  liability  is  past  due  and  unpaid 
shall  be  allowed  to  vote. 

Oaths  of  31  (Sec.  5147.)  Each  director,  when  appointed  or  elected, 
shall  take  an  oath  that  he  will,  so  far  as  the  duty  devolves  on  him, 
dihgently  and  honestly  administer  the  affairs  of  such  association, 
and  will  not  knowingly  violate,  or  willingly  permit  to  be  violated, 
any  of  the  provisions  of  this  Title,  and  that  he  is  the  owner  in 
good  faith,  and  in  his  own  right,  of  the  number  of  shares  of  stock 
required  by  this  Title,  subscribed  by  him,  or  standing  in  his  name 
on  the  books  of  the  association,  and  that  the  same  is  not  hypoth- 
ecated or  in  any  way  pledged  as  security  for  any  loan  or  debt. 
Such  oath,  subscribed  by  the  director  making  it,  and  certified  by 
the  officer  before  whom  it  is  taken,  shall  be  immediately  transmitted 
to  the  Comptroller  of  the  Currency,  and  shall  be  filed  and  pre- 
served in  his  office. 

Failure  to  hold  32.  (Sec.  5149.)  If,  from  any  cause,  an  election  of  directors 
annual  election,  jg  jj^j  made  at  the  time  appointed,  the  association  shall  not  for  that 
cause  be  dissolved,  but  an  election  may  be  held  on  any  subsequent 
day,  thirty  days'  notice  thereof  in  all  cases  having  been  given  in 
a  newspaper  published  in  the  city,  town,  or  county  in  which  the 
association  is  located;  and  if  no  newspaper  is  published  in  such 
city,  town,  or  county  such  notice  shall  be  published  in  a  newspaper 
published  nearest  thereto.  If  the  articles  of  association  do  not  fix  the 
day  on  which  the  election  shall  be  held,  or  if  no  election  is  held 
on  the  day  fixed,  the  day  for  the  election  shall  be  designated  by 
the  board  of  directors  in  their  by-laws,  or  otherwise;  or  if  the 
directors  fail  to  fix  the  day,  shareholders  representing  two-thirds 
of  the  shares  may  do  so. 


NATIONAL    BANK    ACT 75 

33.  (Sec.  5148.)   Any  vacancy  in  the  board  shall  be  filled  by   Vacancies  in 
appointment    by    the    remaining    directors,    and    any    director    so  board  of 
appointed  shall  hold  his  place  until  the  next  election.  directors. 

34.  (Sec.   5150.)    One  of  the  directors,  to  be  chosen  by  the  President  shall 
board,  shall  be  the  president  of  the  board.  ^^  ^  director. 

35.  (Sec.   5185.)   Associations  may  be  organized  in  the  man-  Organization  of 
ner  prescribed  by  this  Title  for  the  purpose  of  issuing  notes  payable  Sold  banks. 

in  gold. 

36.  The  act  of  February  14,   1880,  provides  that  any  national  Conversion  of 
gold  bank  organized  under  the  provisions  of  the  laws  of  the  United  gold  banl(S. 
States  may,  in  the  manner  and  subject  to  the  provisions  prescribed 

by  section  fifty-one  hundred  and  fifty-four  of  the  Revised  Statutes 
of  the  United  States,  for  the  conversion  of  banks  incorporated  under 
the  laws  of  any  State,  cease  to  be  a  gold  bank  and  become  such  an 
association  as  is  authorized  by  section  fifty-one  hundred  and  thirty- 
three,  for  carrying  on  the  business  of  banking,  and  shall  have  the 
same  powers  and  privileges,  and  shall  be  subject  to  the  same  duties, 
responsibilities,  and  rules,  in  all  respects,  as  are  by  law  prescribed 
for  such  associations:  Provided,  That  all  certificates  of  organization 
which  shall  be  issued  under  this  act  shall  bear  the  date  of  the 
original  organization  of  each  bank  respectively  as  a  gold  bank. 

37.  (Sec.   5154.)   Any  bank  incorporated  by  special  law,  or  Conversion  of 
any  banking  institution  organized  under  a  general  law  of  any  State,  state  banks. 
may  become  a  national  association  under  this  Title  by   the   name 

prescribed  in  its  organization  certificate;  and  in  such  case  the  articles 
of  association  and  the  organization  certificate  may  be  executed  by 
a  majority  of  the  directors  of  the  bank  or  banking  institution;  and 
the  certificate  shall  declare  that  the  owners  of  two-thirds  of  the 
capital  stock  have  authorized  the  directors  to  make  such  certificate, 
and  to  change  and  convert  the  bank  or  banking  institution  into  a 
national  association.  A  majority  of  the  directors,  after  executing  the 
articles  of  association  and  organization  certificate,  shall  have  power 
to  execute  all  other  papers,  and  to  do  whatever  may  be  required  to 
make  its  organization  perfect  and  complete  as  a  national  association. 
The  shares  of  any  such  bank  may  continue  to  be  for  the  same 
amount  each  as  they  were  before  the  conversion,  and  the  directors  may 


76 N.    W.    HALSEY    &   CO. 

continue  to  be  the  directors  of  the  association  until  others  are  elected 
or  appointed  in  accordance  with  the  provisions  of  this  chapter;  and 
any  State  bank  which  is  a  stockholder  in  any  other  bank,  by 
authority  of  State  laws,  may  continue  to  hold  its  stock,  although 
either  bank,  or  both,  may  be  organized  under  and  have  accepted 
the  provisions  of  this  Title.  When  the  Comptroller  of  the  Currency 
has  given  to  such  association  a  certificate,  under  his  hand  and  official 
seal,  that  the  provisions  of  this  Title  have  been  complied  with,  and 
that  it  is  authorized  to  commence  the  business  of  banking,  the  asso- 
ciation shall  have  the  same  powers  and  privileges,  and  shall  be 
subject  to  the  same  duties,  responsibilities,  and  rules,  in  all  respects, 
as  are  prescribed  for  other  associations,  originally  organized  as 
national  banking  associations,  and  shall  be  held  and  regarded  as 
such  an  association.  But  no  such  association  shall  have  a  less  capital 
than  the  amount  prescribed  for  associations  organized  under  this 
Title. 

Capital  of       38.    (Sec.   3410.)   The  capital  of  any  State  bank  or  banking 

state  banlis.  association  which  has  ceased  or  shall  cease  to  exist,  or  which  has 

been  or  shall  be  converted  into  a  national  bank,  shall  be  assumed 

to  be  the  capital  as  it  existed  immediately  before  such  bank  ceased 

to  exist  or  was  converted  as  aforesaid. 

Converted  banks  39.  (Sec.  5155.)  It  shall  be  lawful  for  any  bank  or  banking 
ma\)  retain  association,  organized  under  State  laws  and  having  branches,  the 
orancnes.  ^j^pj^^]  being  joint  and  assigned  to  and  used  by  the  mother  bank 
and  branches  in  definite  proportions,  to  become  a  national  banking 
association  in  conformity  with  existing  laws  and  to  retain  and  keep 
in  operation  its  branches,  or  such  one  or  more  of  them  as  it  may 
elect  to  retain,  the  amount  of  the  circulation  redeemable  at  the 
mother  bank  and  each  branch  to  be  regulated  by  the  amount  of 
capital  assigned  to  and  used  by  each. 

Personal  liahilit\f  40.  (Sec.  5151.)  The  shareholders  of  every  national  banking 
of  shareholders,  association  shall  be  held  individually  responsible,  equally  and 
ratably,  and  not  one  for  another,  for  all  contracts,  debts,  and 
engagements  of  such  association  to  the  extent  of  the  amount  of  their 
stock  therein,  at  the  par  value  thereof,  in  addition  to  the  amount 
invested  in  such  shares,   except  that  shareholders  of   any  banking 


NATIONAL    BANK   ACT  77 

association  now  existing  under  State  laws  having  not  less  than  five 
millions  of  dollars  of  capital  actually  paid  in  and  a  surplus  of 
twenty  per  centum  on  hand,  both  to  be  determined  by  the  Comp- 
troller of  the  Currency,  shall  be  liable  only  to  the  amount  invested 
in  their  shares;  and  such  surplus  of  twenty  per  centum  shall  be 
kept  undiminished,  and  be  in  addition  to  the  surplus  provided  for 
in  this  Title;  and  if  at  any  time  there  is  a  deficiency  in  such 
surplus  of  twenty  per  centum  such  association  shall  not  pay  any 
dividends  to  its  shareholders  until  the  deficiency  is  made  good;  and 
i^base  of  such  deficiency  the  Comptroller  of  the  Currency  may 
compel  the  association  to  close  its  business  and  wind  up  its  affairs 
under  the  provisions  of  chapter  four  of  this  Title. 

41.  (Sec.  5152.)    Persons  holding  stock  as  executors,  adminis-  Exceptions  for 
trators,  guardians,  or  trustees  shall  not  be  personally  subject  to  any  trustees,  etc. 
liability  as  stockholders;  but  the  estates  and  funds  in  their  hands 

shall  be  liable  in  like  manner  and  to  the  same  extent  as  the  testator, 
intestate,  ward,  or  person  interested  in  such  trust  funds  would  be  if 
living  and  competent  to  act  and  hold  the  stock  in  his  own  name. 

42.  Sec.   5 1 39  provides  that  no  change  shall  be  made  in  the  Amendment 
articles   of    association   of   a   national    bank   by   which    the   rights,  of  articles 
remedies,  or  security  of  the  existing  creditors  of  the  association  shall  restricted. 
be  impaired. 

43.  (Sec.  5142.)   Any    association    formed    under    this    Title  Increase  of 
may,  by  its  articles  of  association,  provide  for  an  increase  of  its  capital  stock- 
capital  from  time  to  time,  as  may  be  deemed  expedient,  subject  to 

the  limitations  of  this  Title.  But  the  maximum  of  such  increase 
to  be  provided  in  the  articles  of  association  shall  be  determined  by 
the  Comptroller  of  the  Currency.  Sec.  1  of  the  act  of  May  1, 
1886,  provicles_jhat  any  national  banking  association  may,  with 
the  approval  of  the  Comptroller  of  the  Currency,  by  the  vote  of 
shareholders  owning  two-thirds  of  the  stock  of  such  association, 
increase  its  capital  stock,  in  accordance  with  existing  laws,  to  any 
sum  approved  by  the  said  Comptroller,  notwithstanding  the  limit 
fixed  in  its  original  articles  of  association  and  determined  by  said 
Comptroller;  and  no  increase  of  the  capital  stock  of  any  national 
banking  association  either  within  or  beyond  the  limit  fixed  in  its 


78  N.    W.    HALSEY    &   CO. 

original  articles  of  association  shall  be  made  except  in  the  manner 
herein  provided. 

When  increase  44.  (Sec.  5142.)  And  no  increase  of  capital  shall  be  valid 
becomes  vaiia.  yjjfjj  jj^g  ^^ole  amount  of  such  increase  is  paid  in,  and  notice  thereof 
has  been  transmitted  to  the  Comptroller  of  the  Currency,  and  his 
certificate  obtained  specifying  the  amount  of  such  increase  of  capital 
stock,  with  his  approval  thereof,  and  that  it  has  been  duly  paid  in 
as  part  of  the  capital  of  such  association. 

Reduction  of  45,  (Sec.  5143.)  Any  association  formed  under  this  IWe 
capital  stocl(.  may,  by  the  vote  of  shareholders  owning  two-thirds  of  its  capital 
stock,  reduce  its  capital  to  any  sum  not  below  the  amount  required 
by  this  Title  to  authorize  the  formation  of  associations,  but  no  such 
reduction  shall  be  allowable  which  will  reduce  the  capital  of  the 
association  below  the  amount  required  for  its  outstanding  circulation, 
nor  shall  any  such  reduction  be  made  until  the  amount  of  the  proposed 
reduction  has  been  reported  to  the  Comptroller  of  the  Currency  and 
his  approval  thereof  obtained. 

Change  of  title       46.  Sees.  2,  3,  and  4  of  the  act  of  May  1,  1886,  provide: 
and  location. 

Sec.  2.   That  any  national  banking  association  may  change  its 

name  or  the  place  where  its  operations  of  discount  and  deposit  are 
to  be  carried  on  to  any  other  place  within  the  same  State,  not  more 
than  thirty  miles  distant,  with  the  approval  of  the  Comptroller  of 
the  Currency,  by  the  vote  of  shareholders  owning  two-thirds  of  the 
stock  of  such  association.  A  duly  authenticated  notice  of  the  vote 
and  of  the  new  name  or  location  selected  shall  be  sent  to  the  office 
of  the  Comptroller  of  the  Currency,  but  no  change  of  name  or 
location  shall  be  valid  until  the  Comptroller  shall  have  issued  his 
certificate  of  approval  of  the  same. 

Sec.  3.  That  all  debts,  liabilities,  rights,  provisions,  and  powers 
of  the  association  under  its  old  name  shall  devolve  upon  and  inure 
to  the  association  under  its  new  name. 

Sec.  4.  That  nothing  in  this  act  contained  shall  be  so  construed 
as  in  any  manner  to  release  any  national  banking  association  under 
its  old  name  or  at  its  old  location  from  any  liability,  or  affect  any 


NATIONAL    BANK    ACT  79 

action  or  proceeding  in  law  in  which  said  association  may  be  or 
become  a  party  or  interested. 

47.  (Sec.   5156.)   That  nothing  in   this  title  shall   affect  any  Status  of  national 
appointments  made,   acts  done,   or  proceedings  had  or  commenced  banks  organized 
prior  to  the  third  day  of  June,   eighteen  hundred   and  sixty-four,  under  the  act  of 
in  or  toward  the  organization  of  any  national  banking  association  ;  oV^*"^^ 

under  the  act  of  February  twenty-five,  eighteen  hundred  and  sixty- 
three;  but  ail  associations  which  on  the  third  day  of  June,  eighteen 
hundred  and  sixty-four,  were  organized  or  commenced  to  be 
organized  under  that  act  shall  enjoy  all  the  rights  and  privileges 
granted,  and  be  subject  to  all  the  duties,  liabilities,  and  restrictions 
imposed  by  this  Title,  notwithstanding  all  the  steps  prescribed  by 
this  Title  for  the  organization  of  associations  were  not  pursued,  if 
such  associations  were  duly  organized  under  that  act. 

Note — See  page   161    for  Additional  Circulation  Act  of  May 
30.  1908. 

Chapter  Three. 
BANK   CIRCULATION. 

48.  (Sec.  5158.)  The  term  "United  States  Bonds,"  as  United  States 
used  throughout  this  chapter,  shall  be  construed  to  mean  bonds  defined. 
registered  bonds  of  the  United  States, 

49.  (Sec.  5159  as  amended  by  section  8,  act  of  July  12,   Security)  for 
1882,   and   section    1,   act   of   December   21,    1905.)  Every   circulation. 
association,  after  having  complied  with  the  provisions  of 

this  Title,  preliminary  to  the  commencement  of  the  bank- 
ing business,  and  before  it  shall  be  authorized  to  com- 
mence banking  business  under  this  Title,  shall  transfer  and 
deliver  to  the  Treasurer  of  the  United  States  any  United 
States  registered  bonds,  bearing  interest,  or  Panama  canal 
bonds,  to  an  amount  not  less  than  one-fourth  of  the 
capital,  the  capital  being  $150,000  or  less,  as  security  for 
their  circulating  notes.  Such  bonds  shall  be  received  by 
the  Treasurer  upon  deposit  and  shall  be  by  him  safely 
kept  in  his  office  until  they  shall  be  otherwise  disposed 
of  in  pursuance  of  the  provisions  of  this  Title. 


80 N.    W.    HALSEY    &   CO. 

Section  4,  act  of  June  20,  1874,  provides  in  part  that  the 
amount  of  bonds  on  deposit  for  circulation  shall  not 
be  reduced  below  $50,000.  This  determines  the  amount 
of  bonds  required  to  be  deposited  by  banks  organizing 
with  capital  stock  of  over  $150,000. 

(See  sec.  5159  of  the  United  States  Revised  Statutes; 
Sec.  4,  act  of  June  20,  1874;  sec  8,  act  of  July  12,  1882, 
and  act  of  March  14,  1900,  as  to  relation  of  bond  deposit 
to  capital.) 

Relation  of  50.  (Sec.  5160.)  The  deposit  of  bonds  made  by  each 
bond  deposit  association  shall  be  increased  as  its  capital  may  be  paid 
to  capital,  yp  Qj.  increased,  so  that  every  association  shall  at  all 
times  have  on  deposit  with  the  Treasurer  registered  United 
States  bonds  to  the  amount  required  by  law.  And  any 
association  that  may  desire  to  reduce  its  capital  or  close 
up  its  business  and  dissolve  its  organization  may  take  up 
its  bonds  upon  returning  to  the  Comptroller  its  circulating 
notes  in  the  proportion  hereinafter  required,  or  may  take 
up  any  excess  of  bonds  beyond  the  amount  required  by 
law,  and  upon  which  no  circulating  notes  have  been 
delivered. 

Exchange  of  51.  (Sec.  5161.)  To  facilitate  a  compliance  with  the 
bonds,  two  preceding  sections,  the  Secretary  of  the  Treasury  is 
authorized  to  receive  from  any  association,  and  cancel, 
any  United  States  coupon  bonds,  and  to  issue  in  lieu 
thereof  registered  bonds  of  like  amount,  bearing  a  like  rate 
of  interest,  and  having  the  same  time  to  run. 

Bonds  held  b\f  52.  (Sec.  5162.)  All  transfers  of  United  States  bonds 
treasurer,  made  by  any  association  under  the  provisions  of  this 
Title  shall  be  made  to  the  Treasurer  of  the  United  States 
in  trust  for  the  association,  with  a  memorandum  written 
or  printed  on  each  bond,  and  signed  by  the  cashier,  or 
some  other  officer  of  the  association  making  the  deposit. 
A  receipt  shall  be  given  to  the  association,  by  the 
Comptroller  of  the  Currency,  or  by  a  clerk  appointed 
by  him  for  that  purpose,  stating  that  the  bond  is  held  in 


NATIONAL    BANK    ACT  81 

trust  for  the  association  on  whose  behalf  the  transfer  is 
made,  and  as  security  for  the  redemption  and  payment  of 
any  circulating  notes  that  have  been  or  may  be  delivered 
to  such  association.  No  assignment  or  transfer  of  any 
such  bond  by  the  Treasurer  shall  be  deemed  valid  unless 
countersigned  by  the  Comptroller  of  the  Currency. 

53.  (Sec.  5163.)  The  Comptroller  of  the  Currency  shall  Record  of  bond 
keep  in  his  office  a  book  in  which  he  shall  cause  to  be  ^^°"^f^^^' 
entered,  immediately  upon  countersigning  it,  every  transfer 

or  assignment  by  the  Treasurer,  of  any  bonds  belonging 
to  a  national  banking  association,  presented  for  his 
signature.  He  shall  state  in  such  entry  the  name  of  the 
association  from  whose  account  the  transfer  is  made,  the 
name  of  the  party  to  whom  it  is  made,  and  the  par  value 
of  the  bonds  transferred. 

54.  (Sec.  5 1 64.)      The  Comptroller  of  the  Currency  shall,  Notice  of 
immediately  upon  countersigning  and  entering  any  transfer   ^°^^i^^' 
or  assignment  by  the  Treasurer  of  any  bonds  belonging  to 

a  national  banking  association,  advise  by  mail  the  associa- 
tion from  whose  accounts  the  transfer  is  made  of  the  kind 
and  numerical  designation  of  the  bonds  and  the  amount 
thereof  so  transferred. 

55.  (Sec.  5 1 65.)       The  Comptroller  of  the  Currency  shall  Examination  of 
have  at  all  times,  during  office  hours,  access  to  the  books    °^  j°" 

of  the  Treasurer  of  the  United  States  for  the  purpose  of 
ascertaining  the  correctness  of  any  transfer  or  assignment 
of  the  bonds  deposited  by  an  association  presented  to 
the  Comptroller  to  countersign;  and  the  Treasurer  shall 
have  the  like  access  to  the  book  mentioned  in  section 
fifty-one  hundred  and  sixty-three,  during  office  hours,  to 
ascertain  the  correctness  of  the  entries  in  ihe  same;  and 
the  Comptroller  shall  also  at  all  times  have  access  to  the 
bonds  on  deposit  with  the  Treasurer  to  ascertain  their 
amount  and  condition. 

56.  (Sec.  5166.)    Every  association  having  bonds  depos-  Annual 

ited  in  the  office  of  the  Treasurer  of  the  United  States  shall,  e^aminaf/on  of 
once  or  oftener  in  each  fiscal  year,  examine  and  compare 


82  N.    W.    HALSEY    &   CO. 

the  bonds  pledged  by  the  association  with  the  books 
of  the  Comptroller  of  the  Currency  and  with  the  accounts 
of  the  association,  and,  if  they  are  found  correct,  to  execute 
to  the  Treasurer  a  certificate  setting  forth  the  different 
kinds  and  the  amounts  thereof,  and  that  the  same  are  in 
the  possession  and  custody  of  the  Treasurer  at  the  date 
of  the  certificate.  Such  examination  shall  be  made  at 
such  time  or  times  during  the  ordinary  business  hours  as 
the  Treasurer  and  the  Comptroller,  respectively,  may  select, 
and  may  be  made  by  an  officer  or  agent  of  such  association, 
duly  appointed  in  writing  for  that  purpose;  and  his  certifi- 
cate before  mentioned  shall  be  of  like  force  and  validity 
as  if  exectuted  by  the  president  or  cashier.  A  duplicate 
of  such  certificate,  signed  by  the  Treasurer,  shall  be 
retained  by  the  association. 

Central  57.  (Sec.  5 167.)  The  bonds  transferred  to  and  deposited 
provisions  ^ith  the  Treasurer  of  the  United  States  by  any  association 
respecting  ^^^  ^j^^  security  of  its  circulating  notes  shall  be  held  ex- 
'  clusively  for  that  purpose  until  such  notes  are  redeemed, 
except  as  provided  in  this  Title.  The  Comptroller  of  the 
Currency  shall  give  to  any  such  association  powers  of 
attorney  to  receive  and  appropriate  to  its  own  use  the 
interest  on  the  bonds  which  it  has  so  transferred  to  the 
Treasurer;  but  such  powers  shall  become  inoperative 
whenever  such  association  fails  to  redeem  its  circulating 
notes.  Whenever  the  market  or  cash  value  of  any  bonds 
thus  deposited  with  the  Treasurer  is  reduced  below  the 
amount  of  the  circulation  issued  for  the  same  the 
Comptroller  may  demand  and  receive  the  amount  of 
such  depreciation  in  other  United  States  bonds  at  cash 
value,  or  in  money,  from  the  association,  to  be  deposited 
with  the  Treasurer  as  long  as  such  depreciation  continues. 
And  the  Comptroller,  upon  the  terms  prescribed  by  the 
Secretary  of  the  Treasury,  may  permit  an  exchange  to 
be  made  of  any  of  the  bonds  deposited  with  the  Treasurer 
by  any  association  for  other  bonds  of  the  United  States 
authorized  to  be  received  as  security  for  circulating  notes 
if  he  is  of  opinion  that  such  an  exchange  can  be   made 


NATIONAL    BANK    ACT  83 

without  prejudice  to  the  United  States;  and  he  may  direct 
the  return  of  any  bonds  to  the  association  which  trans- 
ferred the  same,  in  sums  of  not  less  than  one  thousand 
dollars,  upon  the  surrender  to  him  and  the  cancellation 
of  a  proportionate  amount  of  such  circulating  notes: 
Provided,  That  the  remaining  bonds  which  shall  have  been 
transferred  by  the  association  offering  to  surrender  circu- 
lating notes  are  equal  to  the  amount  required  for  the 
circulating  notes  not  surrendered  by  such  association,  and 
that  the  amount  of  bonds  in  the  hands  of  the  Treasurer 
is  not  diminished  below  the  amount  required  to  be  kept 
on  deposit  with  him,  and  that  there  has  been  no  failure 
by  the  association  to  redeem  its  circulating  notes,  nor  any 
other  violation  by  it  of  the  provisions  of  this  Title,  and 
that  the  market  or  cash  value  of  the  remaining  bonds  is 
not  below  the  amount  required  for  the  circulation  issued 
for  the  same. 

58.  Sec.  10  of  the  act  of  July  12,  1882,  as  amended  by  Amount  of 
act  of  March  14,  1900,  provides  that  upon  the  deposit  with  circulation 
the  Treasurer  of  the  United  States,  by  any  national  bank-  obtamable. 
ing  association,  of  any  bonds  of  the  United  States  in  the 
manner  provided  by  existing  law,  such  association  shall 
be  entitled  to  receive  from  the  Comptroller  of  the  Currency 
circulating  notes  in  blank,  registered  and  countersigned 
as  provided  by  law,  equal  in  amount  to  the  par  value  of 
the  bonds  so  deposited;  and  any  national  banking  associa- 
tion now  having  bonds  on  deposit  for  the  security  of 
circulating  notes,  and  upon  which  an  amount  of  circulating 
notes  has  been  issued  less  than  the  par  value  of  the  bonds, 
shall  be  entitled,  upon  due  application  to  the  Comptroller 
of  the  Currency,  to  receive  additional  circulating  notes 
in  blank  to  an  amount  which  will  increase  the  circulating 
notes  held  by  such  association  to  the  par  value  of  the 
bonds  deposited,  such  additional  notes  to  be  held  and 
treated  in  the  same  way  as  circulating  notes  of  national 
banking  associations  heretofore  issued,  and  subject  to  all 
the  provisions  of  law  affecting  such  notes:  Provided, 
That  the  circulating  notes  furnished  to  national  banking 


84  N.    W.    HALSEY    &   CO. 

associations  under  the  provisions  of  this  act  shall  be  of  the 
denominations  prescribed  by  law,  except  that  no  national 
banking  association  shall,  after  the  passage  of  this  act, 
be  entitled  to  receive  from  the  Comptroller  of  the  Cur- 
rency, or  to  issue  or  reissue  or  place  in  circulation,  more 
than  one-third  in  amount  of  its  circulating  notes  of  the 
denomination  of  five  dollars;  And  provided  further.  That 
the  total  amount  of  such  notes  issued  to  any  such  associa- 
tion may  equal  at  any  time  but  shall  not  exceed  the  amount 
at  such  time  of  its  capital  stock  actually  paid  in. 

Preparation  of  "Sec.  5 1  72.  (As  amended  May  thirtieth,  nineteen  hundred  and 
bank  circulation,  eight.)  In  order  to  furnish  suitable  notes  for  circulation,  the 
Comptroller  of  the  Currency  shall,  under  the  direction  of  the 
Secretary  of  the  Treasury,  cause  plates  and  dies  to  be  engraved, 
in  the  best  manner  to  guard  against  counterfeiting  and  fradulent 
alterations,  and  shall  have  printed  therefrom,  and  numbered,  such 
quantity  of  circulating  notes,  in  blank,  of  the  denominations  of 
five  dollars,  ten  dollars,  twenty  dollars,  fifty  dollars,  one  hundred 
dollars,  five  hundred  dollars,  one  thousand  dollars,  and  ten 
thousand  dollars,  as  may  be  required  to  supply  the  associations 
entitled  to  receive  the  same.  Such  notes  shall  state  upon  their  face 
that  they  are  secured  by  United  States  bonds  or  other  securities, 
certified  by  the  written  or  engraved  signatures  of  the  Treasurer 
and  Register  and  by  the  imprint  of  the  seal  of  the  Treasury. 
They  shall  also  express  upon  their  face  the  promise  of  the  associa- 
tion receiving  the  same  to  pay  on  demand,  attested  by  the  signature 
of  the  president  or  vice-president  and  cashier.  The  Comptroller  of 
the  Currency,  acting  under  the  direction  of  the  Secretary  of  the 
Treasury,  shall  as  soon  as  practicable  caused  to  be  prepared  circu- 
lating notes  in  blank,  registered  and  countersigned,  as  provided  by 
law,  to  an  amount  equal  to  fifty  per  centum  of  the  capital  stock 
of  each  national  banking  association;  such  notes  to  be  deposited 
in  the  Treasury  or  in  the  subtreasury  of  the  United  States  nearest 
the  place  of  business  of  each  association,  and  to  be  held  for  such 
association,  subject  to  the  order  of  the  Comptroller  of  the  Currency, 
for  their  delivery  as  provided  by  law:  Provided,  That  the 
Comptroller  of  the  Currency  may  issue  national  bank  notes  of  the 


NATIONAL    BANK    ACT     85 

present  form  until  plates  can  be  prepared  and  circulating  notes 
issued  as  above  provided:  Provided,  however.  That  in  no  event 
shall  bank  notes  of  the  present  form  be  issued  to  any  bank  as 
additional  circulation  provided  for  by  this  Act." 

60.  Sec.   5   of  the   act  of  June   20,    1874,   provides   that  the  Circulation  shall 
Comptroller  of  the  Currency  shall,  under  such  rules  and  regulations  bear  charter 

as  the  Secretary  of  the  Treasury  may  prescribe,  cause  the  charter  number. 
numbers  of   the   associations   to  be  printed  upon   all   national-bank 
notes  which  may  be  hereafter  issued  by  him. 

61.  (Sec.  5173.)   The  plates  and  special  dies  to  be  procured  Control  of  plates 
by  the  Comptroller  of  the  Currency  for  the  printing  of  such  circu-  and  dies. 
lating  notes  shall  remain  under  his  control   and   direction  and  the 

expenses  necessarily  incurred  in  executing  the  laws  respecting  the 
procuring  of  such  notes  and  all  other  expenses  of  the  Bureau  of  the 
Currency  [except  as  provided  by  sec.  3,  act  June  20,  1874, 
and  sees.  6  and  8,  act  of  July  12,  1882]  shall  be  paid  out  of 
the  proceeds  of  the  taxes  or  duties  assessed  and  collected  on  the 
circulation  of  national  banking  associations  under  this  Title. 

62.  (Sec.  51  74.)  The  Comptroller  of  the  Currency  shall  cause  Examination  of 
to  be  examined,  each  year,  the  plates,  dies,  but  pieces  [bed  pieces],  plates  and  dies. 
and    other    material    from    which    the    national-bank    circulation    is 

printed,  in  whole  or  in  part,  and  file  in  his  office  annually  a  correct 
list  of  the  same.  Such  material  as  shall  have  been  used  in  the 
printing  of  the  notes  of  associations  which  are  in  liquidation,  or 
have  closed  business,  shall  be  destroyed,  under  such  regulations 
as  shall  be  prescribed  by  the  Comptroller  of  the  Currency  and 
approved  by  the  Secretary  of  the  Treasury.  The  expenses  of 
any  such  examination  or  destruction  shall  be  paid  out  of  any 
appropriation  made  by  Congress  for  the  special  examination  of 
national  banks  and  bank-note  plates. 

63.  (Sec.  5182.)  After  any  association  receiving  circulating  (^^^^^/q^'q^^  ^^j. 
notes  under  this  Title  has  caused  its  promise  to  pay  such  notes  ivhat  receivable. 
on   demand   to   be   signed   by   the   president   or   vice-president   and 

cashier  thereof,  in  such  manner  as  to  make  them  obligatory 
promissory  notes,  payable  on  demand  at  its  place  of  business,  such 
association  may  issue  and  circulate  the  same  as  money.     And  the 


86 N.    W.    HALSEY   &   CO. 

same  shall  be  received  at  par  in  all  parts  of  the  United  States 
in  payment  of  taxes,  excises,  public  lands,  and  all  other  dues  to 
the  United  States,  except  duties  on  imports;  and  also  for  all 
salaries  and  other  debts  and  demands  owing  by  the  United  States 
to  individuals,  corporations,  and  associations  within  the  United 
States,  except  interest  on  the  public  debt,  and  in  redemption  of  the 
national  currency. 

Circulation  of  64.  (Sec.  5185.)  Associations  may  be  organized  in  the  manner 
gold  banlis.  prescribed  by  this  Title  for  the  purpose  of  issuing  notes  payable  in 
gold;  and  upon  the  deposit  of  any  United  States  bonds  bearing 
interest  payable  in  gold  with  the  Treasurer  of  the  United  States, 
in  the  manner  prescribed  for  other  associations,  it  shall  be  lawful 
for  the  Comptroller  of  the  Currency  to  issue  to  the  association 
making  the  deposit  circulating  notes  of  different  denominations, 
but  none  of  them  of  less  than  five  dollars,  and  not  exceeding  in 
amount  eighty  per  centum  of  the  par  value  of  the  bonds  deposited, 
which  shall  express  the  promise  of  the  association  to  pay  them, 
upon  presentation  at  the  office  at  which  they  are  issued,  in  gold  coin 
of  the  United  States,   and  shall  be  so  redeemable. 

JVorn-out  or  65.  (Sec.  5184.)  It  shall  be  the  duty  of  the  Comptroller 
mutilated  of  the  Currency  to  receive  worn-out  or  mutilated  circulating  notes 
circutation.  issued  by  any  banking  association,  and  also,  on  due  proof  of  the 
destruction  of  any  such  circulating  notes,  to  deliver  in  place  thereof 
to  the  association  other  blank  circulating  notes  to  an  equal  amount. 
Such  worn-out  or  mutilated  notes,  after  a  memorandum  has  been 
entered  in  the  proper  books,  in  accordance  with  such  regulations 
as  may  be  established  by  the  Comptroller,  as  well  as  all  circulating 
notes  which  shall  have  been  paid  or  surrendered  to  be  canceled, 
shall  be  macerated  in  presence  of  four  persons,  one  to  be  appointed 
by  the  Secretary  of  the  Treasury,  one  by  the  Comptroller  of  the 
Currency,  one  by  the  Treasurer  of  the  United  States,  and  one  by 
the  association,  under  such  regulations  as  the  Secretary  of  the 
Treasury  may  prescribe.  A  certificate  of  such  maceration,  signed 
by  the  parties  so  appointed,  shall  be  made  in  the  books  of  the 
Comptroller,  and  a  duplicate  thereof  forwarded  to  the  association 
whose  notes  are  thus  canceled. 


NATIONAL    BANK    ACT 87 

66.  Sec.  3  of  the  act  of  June  20,  1874,  provides  that  every  Provisions  for 
association  organized,  or  to  be  organized,  under  the  provisions  Tedeeming 
of  the  said  act,  and  of  the  several  acts  amendatory  thereof,  shall  ^^f^^^'^^'^^' 
at  all  times  keep  and  have  on  deposit  in  the  Treasury  of  the  United 
States,  in  lawful  money  of  the  United  States,  a  sum  equal  to  five 
per  centum  of  its  circulation,  to  be  held  and  used  for  the  redemption 
of  such  circulation;  which  sum  shall  be  counted  as  a  part  of  its 
lawful  reserve,  as  provided  in  section  two  of  this  act;  and  when 
the  circulating  notes  of  any  such  associations,  assorted  or  unassorted, 
shall  be  presented  for  redemption,  in  sums  of  one  thousand  dollars 
or  any  multiple  thereof,  to  the  Treasurer  of  the  United  States, 
the  same  shall  be  redeemed  in  United  States  notes.  All  notes 
so  redeemed  shall  be  charged  by  the  Treasurer  of  theUnited  States 
to  the  respective  associations  issuing  the  same,  and  he  shall  notify 
them  severally,  on  the  first  day  of  each  month,  or  oftener,  at  his 
discretion,  of  the  amount  of  such  redemptions;  and  whenever  such 
redemptions  for  any  association  shall  amount  to  the  sum  of  five 
hundred  dollars,  such  association  so  notified  shall  forthwith  deposit 
with  the  Treasurer  of  the  United  States  a  sum  in  United  States 
notes  equal  to  the  amount  of  its  circulating  notes  so  redeemed. 
And  all  notes  of  national  banks,  worn,  defaced,  mutilated,  or  other- 
wise unfit  for  circulation,  shall,  when  received  by  any  assistant 
treasurer,  or  at  any  designated  depositary  of  the  United  States, 
be  forwarded  to  the  Treasurer  of  the  United  States  for  redemption 
as  provided  herein.  And  when  such  redemptions  have  been  so 
reimbursed,  the  circulating  notes  so  redeemed  shall  be  forwarded 
to  the  respective  associations  by  which  they  were  issued;  but  if  any 
of  such  notes  are  worn,  mutilated,  defaced,  or  rendered  otherwise 
unfit  for  use,  they  shall  be  forwarded  to  the  Comptroller  of  the 
Currency  and  destroyed,  and  replaced  as  now  provided  by  law: 
Provided,  That  each  of  said  associations  shall  reimburse  to  the 
Treasury  the  charges  for  transportation  and  the  costs  for  assorting 
such  notes;  and  the  associations  hereafter  organized  shall  also 
severally  reimburse  to  the  Treasury  the  cost  of  engraving  such 
plates  as  shall  be  ordered  by  each  association  respectively;  and  the 
amount  assessed  upon  each  association  shall  be  in  proportion  to 
the  circulation  redeemed,  and  be  charged  to  the  fund  on  deposit 
with  the  Treasurer. 


88 N.    W.    HALSEY    &   CO. 

Withdrawing  67.  Sec.  4  of  the  act  of  June  20,  1874,  provides  that 
circulation,  ^jjy  association  organized  under  this  act,  or  any  of  the 
acts  of  which  this  is  an  amendment,  desiring  to  withdraw 
its  circulating  notes,  in  whole  or  in  part,  may,  upon  the 
deposit  of  lawful  money  with  the  Treasurer  of  the  United 
States  in  sums  of  not  less  than  nine  thousand  dollars, 
take  up  the  bonds  which  said  association  has  on  deposit 
with  the  Treasurer  for  the  security  of  such  circulating 
notes,  which  bonds  shall  be  assigned  to  the  bank  in  the 
manner  specified  in  the  nineteenth  section  of  the  national- 
bank  act;  and  the  outstanding  notes  of  said  association, 
to  an  amount  equal  to  the  legal-tender  notes  deposited, 
shall  be  redeemed  at  the  Treasury  of  the  United  States, 
and  destroyed  as  now  provided  by  law:  Provided,  That 
the  amount  of  the  bonds  on  deposit  for  circulation  shall 
not  be  reduced  below  fifty  thousand  dollars. 

Ceneral       68.  The  act  of  July    12,    1882,   provides:    (Sec.   8.)      That 

provisions  for  the  national   banks  which  shall  hereafter  make  deposits  of   lawful 

withdrawing  money  for  the  retirement  in   full  of  their  circulation  shall,   at  the 

circa  a  ion.  ^^^  ^^  ^^^^^  deposit,  be  assessed  for  the  cost  of  transporting  and 

redeeming  their  notes  then  outstanding,  a  sum  equal  to  the  average 

cost  of  the  redemption  of  national-bank  notes  during  the  preceding 

year,   and  shall   thereupon  pay   such   assessment;   and   all   national 

banks  which  have  heretofore  made  or  shall  hereafter  make  deposits 

of   lawful   money    for   the   reduction   of   their   circulation   shall    be 

assessed,   and  shall  pay  an   assessment  in  the  manner   specified  in 

section  three  of  the  act  approved  June  twentieth,  eighteen  hundred 

and  seventy-four,   for  the  cost  of  transporting  and  redeeming  their 

notes  redeemed  from  such  deposits  subsequently   to  June  thirtieth, 

eighteen   hundred   and   eighty-one. 

"Sec,  9.  (As  amended  May  thirtieth,  nineteen  hundred 
and  eight.)  That  any  national  banking  association  desiring 
to  withdraw  its  circulating  notes,  secured  by  deposit  of 
United  States  bonds  in  the  manner  provided  in  section 
four  of  the  Act  approved  June  twentieth,  eighteen  hundred 
and  seventy-four,  is  hereby  authorized  for  that  purpose 
to  deposit  lawful  money  with  the  Treasurer  of  the  United 


NATIONAL    BANK    ACT  89 

States  and,  with  the  consent  o£  the  Comptroller  of  the 
Currency  and  the  approval  of  the  Secretary  of  the  Treas- 
ury to  withdraw  a  proportionate  amount  of  bonds  held 
as  security  for  its  circulating  notes  in  the  order  of  such 
deposits:  Provided,  That  not  more  that  nine  millions  o£ 
dollars  of  lawful  money  shall  be  so  deposited  during  any 
calendar  month  for  this  purpose. 

"Any  national  banking  association  desiring  to  withdraw 
any  of  its  circulating  notes,  secured  by  the  deposit  of 
securities  other  than  bonds  of  the  United  States,  may  make 
such  withdrawal  at  any  time  in  like  manner  and  effect  by 
the  deposit  of  lawful  money  or  national  bank  notes  with 
the  Treasurer  of  the  United  States,  and  upon  such  deposit 
a  proportionate  share  of  the  securities  so  deposited  may  be 
withdrawn:  Provided,  That  the  deposits  under  this  section 
to  retire  notes  secured  by  the  deposit  of  securities  other 
than  bonds  of  the  United  States  shall  not  be  covered  into 
the  Treasury,  as  required  by  section  six  of  an  Act  entitled 
*An  Act  directing  the  purchase  of  silver  bullion  and  the 
issue  of  Treasury  notes  thereon,  and  for  other  purposes,* 
approved  July  fourteenth,  eighteen  hundred  and  ninety, 
but  shall  be  retained  in  the  Treasury  for  the  purpose  of 
redeeming  the  notes  of  the  bank  making  such  deposit." 

69.  Sec.  6  of  the  act  of  July  12,  1882,  provides  that  the  Circulation  of 
circulating  notes  of  any  association  so  extending  the  period  of  its  extended  banl^s. 
succession  which  shall  have  been  issued  to  it  prior  to  such  extension 
shall  be  redeemed  at  the  Treasury  of  the  United  States,  as  pro- 
vided in  section  three  of  the  act  of  June  twentieth,  eighteen  hundred 
and  seventy-four,  entitled  "An  act  fixing  the  amount  of  United 
States  notes,  providing  for  redistribution  of  national  bank  currency, 
and  for  other  purposes,"  and  such  notes  when  redeemed  shall  be 
forwarded  to  the  Comptroller  of  the  Currency,  and  destroyed,  as 
now  provided  by  law;  and  at  the  end  of  three  years  from  the 
date  of  the  extension  of  the  corporate  existence  of  each  bank  the 
association  so  extended  shall  deposit  lawful  money  with  the  Treas- 
urer of  the  United  States  sufficient  to  redeem  the  remainder  of  the 
circulation  which  was  outstanding  at  the  date  of  its  extension,  as 


90  N.    W.    HALSEY    &   CO. 

provided  in  sections  fifty-two  hundred  and  twenty-two,  fifty-two 
hundred  and  twenty-four,  and  fifty-two  hundred  and  twenty-five 
of  the  Revised  Statutes;  and  any  gain  that  may  arise  from  the 
failure  to  present  such  circulating  notes  for  redemption  shall  inure 
to  the  benefit  of  the  United  States;  and  from  time  to  time,  as 
such  notes  are  redeemed  or  lawful  money  deposited  therefor  as 
provided  herein,  new  circulating  notes  shall  be  issued  as  provided 
for  by  this  act,  bearing  such  devices,  to  be  approved  by  the  Secre- 
tary of  the  Treasury,  as  shall  make  them  readily  distinguishable 
from  the  circulating  notes  heretofore  issued:  Provided,  however. 
That  each  banking  association  which  shall  obtain  the  benefit  of 
this  act  shall  reimburse  to  the  Treasury  the  cost  of  preparing  the 
plate  or  plates  for  such  new  circulating  notes  as  shall  be  issued 
to  it. 

Circulation  of  70.  (Sec.  5225.)  Whenever  the  Treasurer  has  redeemed  any 
Liquiaating  ban^s.  ^^  ^^  notes  of  an  association  which  has  commenced  to  close  its 
affairs,  he  shall  cause  the  notes  to  be  mutilated  and  charged  to 
the  redemption  account  of  the  association;  and  all  notes  so 
redeemed  by  the  Treasurer  shall,  every  three  months,  be  certified 
to  and  destroyed  in  the  manner  prescribed  in  section  fifty-one 
hundred  and  eighty-four. 

Circulation  of  71.  Sec.  8  of  the  act  of  June  20,  1874,  provides:  And  it 
closed  banfis.  gj^j^jj  j^g  ^^  j^^y  ^f  jj^g  Treasurer,  assistant  treasurers,  designated 
depositaries,  and  national  bank  depositaries  of  the  United  States 
to  assort  and  return  to  the  Treasury  for  redemption  the  notes  of 
such  national  banks  as  have  failed,  or  gone  into  voluntary  liquida- 
tion for  the  purpose  of  winding  up  their  affairs,  and  of  such  as 
shall  hereafter  so  fail  or  go  into  liquidation. 

Regulations  for       72.    (Sec.  5232.)   The  Secretary  of  the  Treasury  may,  from 

redemption  ^^^^  j^  time,   make   such  regulations   respecting   the  disposition   to 

be   made   of   circulating   notes   after   presentation   at   the   Treasury 

of  the  United  States  for  payment,  and  respecting  the  perpetuation  of 

the  evidence  of  the  payment  thereof,  as  may  seem  to  him  proper. 

Redeemed  notes       73,    (Sec.    5233.)   All  notes  of   national  banking   associations 
to  be  canceled,  presented  at  the  Treasury  of  the  United  States  for  payment  shall, 
on  being  paid,  be  canceled. 


NATIONAL    BANK   ACT  91 

74.  Sec.  3  of  the  act  approved  June  20,   1 874,  provides  that  Redemption  in 
when   the   circulating   notes   of   any   such   associations,    assorted   or  United  States 
unassorted,    shall    be    presented    for    redemption,    in    sums    of    one  ''o'^*- 
thousand  dollars  or  any  multiple  thereof,  to  the  Treasurer  of  the 

United  States,  the  same  shall  be  redeemed  in  United  States  notes. 

75.  Sec.   6  of  the  act  of  July    14,   1890,  provides  that  upon  Disposition  of 
the  passage  of  this  act  the  balances  standing  with  the  Treasurer  redemption 

of  the  United  States  to  the  respective  credits  of  national  banks  account. 
for  deposits  made  to  redeem  the  circulating  notes  of  such  banks, 
and  all  deposits  thereafter  received  for  like  purpose,  shall  be 
covered  into  the  Treasury  as  a  miscellaneous  receipt,  and  the 
Treasurer  of  the  United  States  shall  redeem  from  the  general 
cash  in  the  Treasury  the  circulating  notes  of  said  banks  which 
may  come  into  his  possession  subject  to  redemption;  and  upon  the 
certificate  of  the  Comptroller  of  the  Currency  that  such  notes 
have  been  received  by  him  and  that  they  have  been  destroyed 
and  that  no  new  notes  will  be  issued  in  their  place,  reimburse- 
ment of  their  amount  shall  be  made  to  the  Treasurer,  under  such 
regulations  as  the  Secretary  of  the  Treasury  may  prescribe, 
from  an  appropriation  hereby  created,  to  be  known  as  "national- 
bank  notes,  redemption  account."  But  the  provisions  of  this  act 
shall  not  apply  to  the  deposits  received  under  section  three  of 
the  act  of  June  twentieth,  eighteen  hundred  and  seventy-four, 
requiring  every  national  bank  to  keep  in  lawful  money  with  the 
Treasurer  of  the  United  States  a  sum  equal  to  five  per  centinn  of 
its  circulation,  to  be  held  and  used  for  the  redemption  of  its 
circulating  notes;  and  the  balance  remaining  of  the  deposits  so 
covered  shall,  at  the  close  of  each  month,  be  reported  on  the 
monthly  public  debt  statement  as  debt  of  the  United  States  bearing 
no  interest. 

76.  The  act  of  July  28,    1 892,   stipulates  that  the  provisions  Redemption  of 
of   the  Revised   Statutes  of   the   United   States,   providing   for   the  incomplete 
redemption  of  national-bank  notes  shall  apply  to  all  national-bank  cifc^^<iuon. 
notes  that  have  been  or  may  be  issued  to,  or  received  by,   any 

national  bank,  notwithstanding  such  notes  may  have  been  lost  by  or 
stolen  from  the  bank  and  put  in  circulation  without  the  signature 


92  N.    W.    HALSEY    &   CO. 

or   upon    the    forged   signature   of    the   president   or    vice-president 
and  cashier. 

Banks  take  77.  (Sec.  5196.)  Every  national  banking  association  formed 
circulation  ^^  existing  under  this  Title  shall  take  and  receive  at  pE".  for 
any  debt  or  liability  to  it,  any  and  all  notes  or  bills  issued  by  any 
lawfully  organized  national  banking  association.  But  this  provision 
shall  not  apply  to  any  association  organized  for  the  purpose  of 
issuing  notes  payable  in  gold. 

Issue  of  other         78.    (Sec.  5183.)      No  national  banking  association  snail  issue 
notes  prohibited,    post  notes  or  any  other  notes  to  circulate  as  money  than  such  as 

are  authorized  by  the  provisions  of  this  Title. 

Fraudulent  notes        79,  Sec.   5   of   the   act  of  June   30,    1876.   provides   that  all 

'     "    United    States    officers    charged    with    the    receipt    or    disbursement 

of  public  moneys,   and  all  officers  of  national  banks,   shall  stamp 

or    write    in    plain    letters    the    word    "counterfeit,"    "altered,"    or 

"worthless,"  upon  all  fraudulent  notes  issued  in  the  form  of  and 

intended  to  circulate  as  money  which  shall  be  presented   at  their 

places  of  business;  and  if  such  officer  shall  wrongfully  stamp  any 

genuine  note  of  the  United  States,  or  of  the  national  banks,  they 

shall,  upon  presentation,  redeem  such  notes  at  the  face  value  thereof. 

Note. — See  page   161    for  additional  Circulation  Act  of  May 

30,  1908. 

Chapter  Four. 
TAX   ON    CIRCULATION. 

Tax  on  "Sec.  5214.  (As  amended  May  thirtieth,  nineteen  hun- 
circulalion.  dred  and  eight.)  National  banking  associations  having  on 
deposit  bonds  of  the  United  States,  bearing  interest  at  the 
rate  of  two  per  centum  per  annum,  including  the  bonds 
issued  for  the  construction  of  the  Panama  Canal,  under 
the  provisions  of  section  eight  of  'An  Act  to  provide  for 
the  construction  of  a  canal  connecting  the  waters  of  the 
Atlantic  and  Pacific  oceans,'  approved  June  twentieth, 
nineteen  hundred  and  two,  to  secure  its  circulating  notes, 
shall  pay  to  the  Treasurer  of  the  United  States,  in  the 
months  of  January  and  July,  a  tax  of  one-fourth  of  one 


NATIONAL    BANK    ACT 93 

per  centum  each  half  year  upon  the  average  amount  of 
such  of  its  notes  in  circulation  as  are  based  upon  the  deposit 
of  such  bonds;  and  such  associations  having  on  deposit 
bonds  of  the  United  States  bearing  interest  at  a  rate  higher 
than  two  per  centum  per  annum  shall  pay  a  tax  of  one-half 
of  one  per  centum  each  half  year  upon  the  average  amount 
of  such  of  its  notes  in  circulation  as  are  based  upon  the 
deposit  of  such  bonds.  National  banking  associations 
having  circulating  notes  secured  otherwise  than  by  bonds 
of  the  United  States  shall  pay  for  the  first  month  a  tax 
at  the  rate  of  five  per  centum  per  annum  upon  the  average 
amount  of  such  of  their  notes  in  circulation  as  are  based 
upon  the  deposit  of  such  securities,  and  afterwards  an 
additional  tax  of  one  per  centum  per  annum  for  each 
month  until  a  tax  of  ten  per  centum  per  annum  is  reached, 
and  thereafter  such  tax  of  ten  per  centum  per  annum,  upon 
the  average  amount  of  such  notes.  Every  national  ^ 
banking  association  having  outstanding  circulating  notes 
secured  by  a  deposit  of  other  securities  than  United 
States  bonds  shall  make  monthly  returns,  under  oath  of 
its  president  or  cashier,  to  the  Treasurer  of  the  United 
States,  in  such  form  as  the  Treasurer  may  prescribe,  of 
the  average  monthly  amount  of  its  notes  so  secured  in 
circulation;  and  it  shall  be  the  duty  of  the  Comptroller 
of  the  Currency  to  cause  such  reports  of  notes  in  circula- 
tion to  be  verified  by  examination  of  the  banks'  records. 
The  taxes  received  on  circulating  notes  secured  otherwise 
than  by  bonds  of  the  United  States  shall  be  paid  into 
the  Division  of  Redemption  of  the  Treasury  and  credited 
and  added  to  the  reserve  fund  held  for  the  redemption  of 
United  States  and  other  notes." 

81.    (Sec.   5215.)    In  order  to  enable  the  Treasurer  to  assess  Semi-annual 
the    duties    imposed    by    the    preceding    sections,    each    association  return  of 
shall,  within  ten  days  from  the   first  days  of   January   and  July  circulation. 
of  each  year,   make  a  return,  under  the  oath  of  its  president  or 
cashier,   to  the  Treasurer  of  the  United  States,   in  such   form  as 
the  Treasurer  may  prescribe,  of  the  average  amount  of  its  notes 
in   circulation   for  the  six  months  next  preceding  the  most  recent 


94 N.    W.    HALSEY    &   CO. 

first  day  of  January  or  July.  Every  association  which  fails  so 
to  make  such  returns  shall  be  liable  to  a  penalty  of  two  hundred 
dollars,  to  be  collected  either  out  of  the  interest  as  it  may  become 
due  such  association  on  the  bonds  deposited  with  the  Treasurer, 
or,  at  his  option,  in  the  manner  in  which  penalties  are  to  be  collected 
of  other  corporations  under  the  laws  of  the  United  States. 

Proceedings  on       82.   (Sec.    5216.)   Whenever   any    association    fails    to   make 

aejau  L  ^^  ^^^^  yearly  return  required  by  the  preceding  section,  the  duties 

to  be  paid  by  such  association  shall  be  assessed  upon  the  amount 

of  notes  delivered  to  such  association  by  the  Comptroller  of   the 

Currency. 

Enforcing  tax  83.  (Sec.  5217.)  Whenever  an  association  fails  to  pay  the 
on  circuLation.  Jyfjgg  imposed  by  the  three  preceding  sections,  the  sums  due  may 
be  collected  in  the  manner  provided  for  the  collection  of  United 
States  taxes  from  other  corporations;  or  the  Treasurer  may  reserve 
the  amount  out  of  the  interest,  as  it  may  become  due,  on  the  bonds 
deposited  with  him  by  such  defaulting  association. 

Refunding  84.  (Sec.  5218.)  In  all  cases  where  an  association  has  paid 
excess  tax.  ^j,  ^j^^y  p^^y  ^  excess  of  what  may  be  or  has  been  found  due 
'from  it,  on  account  of  the  duty  required  to  be  paid  to  the 
Treasurer  of  the  United  States,  the  association  may  state  an 
account  therefor,  which,  on  being  certified  by  the  Treasurer  of  the 
United  States,  and  found  correct  by  the  Comptroller  of  the 
Treasury,  shall  be  refunded  in  the  ordinary  manner  by  warrant 
on  the  Treasury. 

Circulation,       85.    (Sec.    3411.)   Whenever    the    outstanding    circulation    of 

en  exemp    ^       bank,  association,  corporation,  company,  or  person  is  reduced 
from  tax.      ■'  ,.       r  r    i       i  i 

to  an  amount  not  exceedmg  hve  per  centum  or  the  chartered  or 

declared   capital   existing   at   the    time    the   same   was   issued,    said 

circulation  shall  be   free  from  taxation;   and  whenever   any  bank 

which   has   ceased   to   issue   notes   for   curculation   deposits   in    the 

Treasury  of  the  United  States,   in  lawful   money,   the  amount  of 

its   outstanding    circulation,    to    be    redeemed    at   par,    under    such 

regulations    as    the   Secretary    of    the    Treasury    shall    prescribe,    it 

shall  be  exempt  from  any  tax  upon  such  circulation. 


NATIONAL    BANK    ACT 95 

86.  Sees.    19,  20,  and  21   of  the  act  of  February  8,    1875,  Tax  on 
provide:  unauthorized 

circulation. 

Sec.  19.  That  every  person,  firm,  association,  other  than 
national  banking  associations,  and  every  corporation.  State  bank, 
or  State  banking  association  shall  pay  a  tax  of  ten  per  centum 
on  the  amount  of  their  own  notes  used  for  circulation  and  paid 
out  by  them. 

Sec.  20.  That  every  such  person,  firm,  association,  corporation. 
State  bank,  or  State  banking  association,  and  also  every  national 
banking  association,  shall  pay  a  like  tax  of  ten  per  centum  on 
the  amount  of  notes  of  any  person,  firm,  association,  other  than 
a  national  banking  association,  or  of  any  corporation,  State  bank, 
or  State  banking  association,  or  of  any  town,  city,  or  municipal 
corporation,  used  for  circulation  and  paid  out  by  them. 

Sec.  2 1 .  That  the  amount  of  such  circulating  notes,  and  of 
the  tax  due  thereon,  shall  be  returned,  and  the  tax  paid  at  the 
same  time,  and  in  the  same  manner,  and  with  like  penalties  for 
failure  to  return  and  pay  the  same,  as  provided  by  law  for  the 
return  and  payment  of  taxes  on  deposits,  capital,  and  circulation 
imposed  by  the  existing  provisions  of  internal-revenue  law. 

87.  (Sec.  3414.)  A  true  and  complete  return  of  the  monthly  Semi-annual 
amount  of  circulation,  as  aforesaid,  and  of  the  monthly  amount  ''^'"'""  ''/  laxable 
of  notes  of  persons,  town,  city,  or  municipal  corporations.  State 
banks,  or  State  banking  associations  paid  out  as  aforesaid  for 
the  previous  six  months,  shall  be  made  and  rendered  in  dupHcate 
on  the  first  day  of  December  and  the  first  day  of  June  by  each  of 
such  banks,  associations,  corporations,  companies,  or  persons,  with 
a  declaration  annexed  thereto,  under  the  oath  of  such  person,  or 
of  the  president,  or  cashier  of  such  bank,  association,  corporation, 
or  company,  in  such  form  and  manner  as  may  be  prescribed  by 
the  Commissioner  of  Internal  Revenue,  that  the  same  contains 
a  true  and  faithful  statement  of  the  amounts  subject  to  tax,  as 
aforesaid;  and  one  copy  shall  be  transmitted  to  the  collector  of 
the  district  in  which  any  such  bank,  association,  corporation, 
or  company  is  situated,  or  in  which  such  person  has  his  place  of 
business,  and  one  copy  to  the  Commissioner  of  Internal  Revenue. 


96  N.    W.    HALSEY    &   CO. 


Failure  to  make  88.  (Sec.  3415.)  In  default  of  the  returns  provided  in  the 
such  return,  preceding  section  the  amount  of  circulation  and  notes  of  persons, 
town,  city,  and  municipal  corporations,  State  banks,  and  State 
banking  associations  paid  out,  as  aforesaid,  shall  be  estimated  by 
the  Commissioner  of  Internal  Revenue,  upon  the  best  information 
he  can  obtain.  And  for  any  refusal  or  neglect  to  make  return 
and  payment  any  such  bank,  association,  corporation,  company, 
or  person  so  in  default  shall  pay  a  penalty  of  two  hundred  dollars, 
besides  the  additional  penalty  and  forfeitures  provided  in  other  cases. 

Tax  on  89.  (Sec.  3416.)  Whenever  any  State  bank  or  banking  associa- 
converted  banii  ^^^  j^j^g  j^gg^  converted  into  a  national  banking  association,  and 
such  national  banking  association  has  assumed  the  liabilities  of 
such  State  bank  or  banking  association,  including  the  redemption  of 
its  bills,  by  any  agreement  or  understanding  whatever  with  the 
representatives  of  such  State  bank  or  banking  association,  such 
national  banking  association  shall  be  held  to  make  the  required 
return  and  payment  on  the  circulation  outstanding,  so  long  as  such 
circulation  shall  exceed  five  per  centum  of  the  capital  before  such 
conversion  of  such  State  bank  or  banking  association. 

Tax  provisions  90.  (Sec.  3417.)  The  provisions  of  this  chapter  relating  to 
restricted,  tl^g  tax  on  the  circulation  of  banks  and  to  their  returns,  except  as 
contained  in  sections  thirty-four  hundred  and  eleven,  thirty-four 
hundred  and  twelve,  thirty-four  hundred  and  thirteen,  and  thirty- 
four  hundred  and  sixteen,  and  such  parts  of  sections  thirty-four 
hundred  and  fourteen  and  thirty-four  hundred  and  fifteen  as  relate 
to  the  tax  of  ten  per  centum  on  certain  notes,  shall  not  apply  to 
associations  which  are  taxed  under  and  by  virtue  of  Title 
"National  Banks." 

Taxation  of  91.  (Sec.  3701.)  All  stocks,  bonds.  Treasury  notes,  and  other 
notes,  etc.  obligations  of  the  United  States  shall  be  exempt  from  taxation  by 
or  under  State  or  municipal  or  local  authority.  The  act  of  August 
13,  1894,  provides:  (Sec.  1.)  That  circulating  notes  of  national 
banking  associations  and  United  States  legal-tender  notes  and  other 
notes  and  certificates  of  the  United  States,  payable  on  demand 
and  circulating  or  intended  to  circulate  as  currency,  and  gold, 
silver,  or  other  coin  shall  be  subject  to  taxation  as  money  on  hand 


NATIONAL    BANK    ACT  97 

or  on  deposit  under  the  laws  of  any  State  or  Territory:  Provided, 
That  any  such  taxation  shall  be  exercised  in  the  same  manner  and 
at  the  same  rate  that  any  such  State  or  Territory  shall  tax  money 
or  currency  circulating  as  money  within  its  jurisdiction. 

Sec.  2.  That  the  provisions  of  this  act  shall  not  be  deemed 
or  held  to  change  existing  laws  in  respect  of  the  taxation  of 
national  banking  associations. 

Chapter  Five. 
REGULATION  OF  TJtiE  BANKING  BUSINESS. 

92.  (Sec.  5157:)    The  provisions  of  chapters  two,  three,   and  Lan>s  governing 
four    [three,   five,   and  seven  of  this  edition]    of  this  Title,  which   certain 

are   expressed  without   restrictive   words,    as   applying   to   "national   ^^^^^cianons. 
banking  association,"  or  to  "associations,"  apply  to  all  associations 
organized  to  carry  on  the  business  of  banking  under  any   act  of 
Congress. 

93.  (Sec.  5190.)   The  usual  business  of  each  national  banking   Place  of 
association  shall  be  transacted  at  an  office  or  banking  house  located   tiusmess. 
in  the  place  specified  in  its  organization  certificate. 

94.  (Sec.  5191.)   Every  national  banking  association  in  either  Reserve  cities 
of    the    following   cities:     Albany,    Baltimore,    Boston,    Cincinnati,  ^""  reserve 
Chicago,  Cleveland,  Detroit,  Louisville,  Milwaukee,  New  Orleans,  requirements. 
New   York,   Philadelphia,   Pittsburg,   Saint   Louis,   San   Francisco, 

and  Washington,  shall  at  all  times  have  on  hand  in  lawful  money 
of  the  United  States,  an  amount  equal  to  at  least  twenty-five  per 
centum  of  the  aggregate  amount  of  its  deposits  in  all  respects;  and 
every  other  association  shall  at  all  times  have  on  hand,  in  lawful 
money  of  the  United  States,  an  amount  equal  to  at  least  fifteen 
per  centum  of  the  aggregate  amount  of  its  deposits  in  all  respects. 
(See  paragraphs   104  and   105.) 

NOTE— Act  of  May  30,  1908. 

"Sec.  1 4.     That  the  provisions  of  section  fifty-one  hundred  and  No  reserve  need 

ninety-one  of  the  Revised  Statutes,  with  reference  to  the  reserves  of   ^^  held  against 

national  banking  associations,  shall  not  apply  to  deposits  of  public  "^/^^f "  °/ 

I      .1     T  T  •     1  o  •     1    •  11        ••     ..  public  money. 

moneys  by  the  United  otates  m  designated  depositaries. 


98  N.    W.    HALSEY    &   CO. 

Reserve  not  95.  (Sec.  5191.)  Whenever  the  lawful  money  of  any  associa- 
maintained.  tion  in  any  of  the  cities  named  shall  be  below  the  amount  of  twenty- 
five  per  centum  of  its  deposits,  and  whenever  the  lawful  money 
of  any  other  association  shall  be  below  fifteen  per  centum  of  its 
deposits,  such  association  shall  not  increase  its  liabilities  by  making 
any  new  loans  or  discounts  otherwise  than  by  discounting  or 
purchasing  bills  of  exchange  payable  at  sight,  nor  make  any  dividend 
of  its  profits  until  the  required  proportion  between  the  aggregate 
amount  of  its  deposits  and  its  lawful  money  of  the  United  States 
has  been  restored.  And  the  Comptroller  of  the  Currency  may 
notify  any  association,  whose  lawful-money  reserve  shall  be  below 
the  amount  above  required  to  be  kept  on  hand,  to  make  good  such 
reserve;  and  if  such  association  shall  fail  for  thirty  days  there- 
after so  to  make  good  its  reserve  of  lawful  money,  the  Comptroller 
may,  with  the  concurrence  of  the  Secretary  of  the  Treasury,  appoint 
a  receiver  to  wind  up  the  business  of  the  association,  as  provided 
in  section   fifty-two  hundred   and   thirty-four. 

Reserve  agents'  96.  (Sec.  5192.)  Three-fifths  of  the  reserve  of  fifteen  per 
balances  counted  centum  required  by  the  preceding  section  to  be  kept  may  consist 
as  reserve,  of  balances  due  to  an  association  from  associations  approved  by 
the  Comptroller  of  the  Currency,  organized  under  the  act  of  June 
three,  eighteen  hundred  and  sixty-four,  or  under  this  Title,  and 
doing  business  in  the  cities  of  Albany,  Baltimore,  Boston,  Charles- 
ton, Chicago,  Cincinnati,  Cleveland,  Detroit,  Louisville,  Milwaukee, 
New  Orleans,  New  York,  Philadelphia,  Pittsburg,  Richmond, 
Saint  Louis,  San  Francisco,  and  Washington. 

Clearing-house       97.  Clearing-house    certificates,    representing    specie    or    lawful 

certificates  money   specially  deposited   for   the  purpose,   of   any   clearing-house 

counted  as  association  shall  also  be  deemed  to  be  lawful  money  in  the  posses- 

sion  of  any   association  belonging  to   such   clearing  house,   holding 

and  owning   such   certificate,  within   the  preceding  section. 

Redemption       98.   Sec.  3  of  the  act  of  June  20,   1874,  provides  that  the  five 
fund  counted  pgj.   ^.g^t   redemption    fund,   which    shall    at   all    times   be   kept   on 
as  reserve.  ^jgpQgjj  ^j^j^  ^j^g  Treasurer  of  the  United  States,  shall  be  counted  as 
a  part  of  the  lawful  reserve. 

99.    (Sec.  5193.)   The  Secretary  of  the  Treasury  may  receive 
United  States  notes  on  deposit,  without  interest,  from  any  national 


NATIONAL    BANK    ACT  99 

banking  association,  in  sums  of  not  less  than  ten  thousand  dollars.   United  States 
and  issue  certificates  therefor  in  such  form  as  he  may  prescribe,  in  note  certificates 
denominations  of  not  less  than  five  thousand  dollars,  and  payable  counted  as 
on  demand  in  United  States  notes  at  the  place  where  the  deposits  f^^^^' 
were  made.     The  notes  so  deposited  shall  not  be  counted  as  part 
of  the  lawful-money  reserve  of  the  association;  but  the  certificates 
issued  therefor  may  be  counted  as  part  of  its  lawful-money  reserve, 
and  may  be  accepted  in  the  settlement  of  clearing-house  balances 
at  the  places  where  the  deposits  therefor  were  made.      (Repealed 
March    14,    1900.) 

100.  (Sec.  5194.)     The  pwwer  conferred  on  the  Secretary  of  Redemption  of 
the  Treasury  by   the  preceding   section   shall   not  be   exercised   so  s"c/i  certificates. 
as   to  create   any   expansion   or   contraction   of   the   currency;    and 

United  States  notes  for  which  certificates  are  issued  under  that 
section,  or  other  United  States  notes  of  like  amount,  shall  be 
held  as  special  deposits  in  the  Treasury  and  used  only  for  redemption 
of  such  certificates. 

101.  Sec.    12  of  the  act  of  July    12,    1882,  provides  that  the  United  States 
Secretary   of   the   Treasury   is   authorized   and   directed   to   receive  gold  certificates 
deposits  of  gold  coin  with  the  Treasurer  or  assistant  treasurers  of  counted  as 

the  United  States,  in  sums  of  not  less  than  twenty  dollars,  and  to 
issue  certificates  therefor  in  denominations  of  not  less  than  twenty 
dollars  each,  corresponding  with  the  denominations  of  United 
States  notes.  The  coin  deposited  for  or  representing  the  certificates 
of  deposit  shall  be  retained  in  the  Treasury  for  the  payment  of 
the  same  on  demand.  Said  certificates  shall  be  receivable  for 
customs,  taxes,  and  all  public  dues,  and  when  so  received  may 
be  reissued;  and  such  certificates,  as  also  silver  certificates,  when 
held  by  any  national  banking  association,  shall  be  counted  as 
part  of  its  lawful  reserve;  and  no  national  banking  association  shall 
be  a  member  of  any  clearing  house  in  which  such  certificates  shall 
not  be  receivable  in  the  settlement  of  clearing-house  balances: 
PTovided,  That  the  Secretary  of  the  Treasury  shall  suspend  the 
issue  of  such  gold  certificates  whenever  the  amount  of  gold  coin 
and  gold  bullion  in  the  Treasury  reserved  for  the  redemption  of 
United  States  notes  falls  below  one  hundred  millions  of  dollars; 
and  the  provisions  of  section  fifty-two  hundred   and   seven   of   the 


100 N.    W.    HALSEY    &   CO. 

Revised  Statutes  shall  be  applicable  to  the  certificates  herein 
authorized    and    directed    to    be    issued. 

Reserve         102.    (Sec.  5186.)    Every  association  organized  for  the  purpose 
rcquvrements    ^f  issuing  notes  payable  in  gold  shall  at  all  times  keep  on  hand 
°  ^  '    not  less  than  twenty-five  per  centum  of  its  outstanding  circulation, 

in  gold  or  silver  coin  of  the  United  States;  and  shall  receive  at  par 
in  the  payment  of  debts  the  gold  notes  of  every  other  such  associa- 
tion which  at  the  time  of  such  payment  is  redeeming  its  circulating 
notes  in  gold  coin  of  the  United  States,  and  shall  be  subject  to 
all  the  provisions  of  this  Title:  Provided,  That,  in  applying  the  same 
to  associations  organized  for  issuing  gold  notes,  the  terms  "lawful 
money"  and  "lawful  money  of  the  United  States"  shall  be  con- 
strued to  mean  gold  or  silver  coin  of  the  United  States;  and  the 
circulation  of  such  association  shall  not  be  within  the  limitation 
of   circulation   mentioned   in   this   Title. 

Reserve  deposit  103.  (Sec.  5195.)  Each  association  organized  in  any  of  the 
in  central  cities  named  in  section  fifty-one  hundred  and  ninety-one  may  keep 
esc  e  ci  p.  Qjjg.jjj^if  Qf  Jts  lawful-money  reserve  in  cash  deposits  in  the  city  of 
New  York.  But  the  foregoing  provision  shall  not  apply  to  associa- 
tions organized  and  located  in  the  city  of  San  Francisco  for  the 
purpose  of  issuing  notes  payable  in  gold.  This  section  shall  not 
relieve  any  association  from  its  liability  to  redeem  its  circulating 
notes  at  its  own  counter  at  par  in  lawful  money  on  demand. 

Additional  104.  Sec.  1  of  the  act  of  March  3,  1887,  as  amended  by 
reserve  cities,  jhe  act  of  March  3.  1903,  provides  that  whenever  three-fourths 
in  number  of  the  national  banks  located  in  any  city  of  the  United 
States  having  a  population  of  twenty-five  thousand  people  shall 
make  application  to  the  Comptroller  of  the  Currency,  in  writing, 
asking  that  the  name  of  the  city  in  which  such  banks  are  located 
shall  be  added  to  the  cities  named  in  sections  fifty -one  hundred 
and  ninety-one  and  fifty-one  hundred  and  ninety-two  of  the  Revised 
Statutes,  the  Comptroller  shall  have  authority  to  grant  such  request, 
and  every  bank  located  in  such  city  shall  at  all  times  thereafter 
have  on  hand,  in  lawful  money  of  the  United  States,  an  amount 
equal  to  at  least  twenty-five  per  centum  of  its  deposits,  as  provided 
in  sections  fifty-one  hundred  and  ninety-one  and  fifty-one  hundred 
and  ninety-five  of  the  Revised  Statutes. 


NATIONAL    BANK   ACT 


101 


105.  Sec.  2  of  the  act  of  March  3,   1887,  provides  that  when-   Additional 
ever  three-fourths  in  number  of  the  national  banks  located  in  any   central  reserve 
city   of   the   United   States   having   a   population   of   two   hundred   ci<ies. 
thousand  people  shall  make  application  to  the  Comptroller  of   the 

Currency,  in  writing,  asking  that  such  city  may  be  a  central  reserve 
city,  like  the  city  of  New  York,  in  which  one-half  of  the  lawful- 
money  reserve  of  the  national  banks  located  in  other  reserve  cities 
may  be  deposited,  as  provided  in  section  fifty-one  hundred  and 
ninety-five  of  the  Revised  Statutes,  the  Comptroller  shall  have 
authority,    with   the   approval    of   the   Secretary   of   the    Treasury,  < 

to  grant  such  request,  and  every  bank  located  in  such  city  shall 
at  all  times  thereafter  have  on  hand,  in  lawful  money  of  the  United 
States,  twenty-five  per  centum  of  its  deposits,  as  provided  in  section 
fifty-one  hundred  and  ninety -one  of  the  Revised  Statutes. 

106.  (Sec.   5137.)   A  national  banking  association  may  pur-   Real  estate. 
chase,  hold,  and  convey  real  estate  for  the  following  purposes,  and 

for  no  others: 

First.  Such  as  shall  be  necessary  for  its  immediate  accommodation 
in  the  transaction  of  its  business. 

Second.  Such  as  shall  be  mortgaged  to  it  in  good  faith  by  way 
of  security  for  debts  previously  contracted. 

Third.  Such  as  shall  be  conveyed  to  it  in  satisfaction  of  debts 
previously  contracted  in  the  course  of  its  dealings. 

Fourth.  Such  as  it  shall  purchase  at  sales  under  judgments, 
decrees,  or  mortgages  held  by  the  association,  or  shall  purchase 
to  secure  debts  due  to  it. 

But  no  such  association  shall  hold  the  possession  of  any  real 
estate  under  mortgage,  or  the  title  and  possession  of  any  real  estate 
purchased  to  secure  any  debts  due  to  it,  for  a  longer  period  than 
five  years. 

107.  (Sec.  5197.)   Any  association  may  take,  receive,  reserve.    Interest. 
and  charge  on  any  loan  or  discount  made,  or  upon  any  note,  bill 

of  exchange,  or  other  evidence  of  debt,  interest  at  the  rate  allowed 
by  the  laws  of  the  State,  Territory,  or  District  where  the  bank 
is  located,  and  no  more,  except  that  where  by  the  laws  of  any  State 
a  different  rate  is  limited  for  banks  of  issue  organized  under  State 


102  N.    W.    HALSEY    &   CO. 

laws,  the  rate  so  limited  shall  be  allowed  for  associations  organized 
or  existing  in  any  such  State  under  this  Title.  When  no  rate  is 
fixed  by  the  laws  of  the  State,  or  Territory,  or  District,  the  bank 
may  take,  receive,  reserve,  or  charge  a  rate  not  exceeding  seven 
per  centum,  and  such  interest  may  be  taken  in  advance,  reckoning 
the  days  from  which  the  note,  bill,  or  other  evidence  of  debt  has 
to  run.  And  the  purchase,  discount,  or  sale  of  a  bona  fide  bill 
of  exchange,  payable  at  another  place  than  the  place  of  such  pur- 
chase, discount,  or  sale,  at  not  more  than  the  current  rate  of 
exchange  for  sight  drafts  in  addition  to  the  interest,  shall  not  be 
considered  as  taking  or  receiving  a  greater  rate  of  interest. 

Penalty  for  108.  (Sec.  5198.)  The  taking,  receiving,  reserving,  or  charg- 
unlavtful  interest,  ing  a  rate  of  interest  greater  than  is  allowed  by  the  preceding  section, 
when  knowingly  done,  shall  be  deemed  a  forfeiture  of  the  entire 
interest  which  the  note,  bill,  or  other  evidence  of  debt  carries  with  it, 
or  which  has  been  agreed  to  be  paid  thereon.  In  case  the  greater 
rale  of  interest  has  been  paid,  the  person  by  whom  it  has  been  paid, 
or  his  legal  representatives,  may  recover  back,  in  an  action  in  the 
nature  of  an  action  of  debt,  twice  the  amount  of  the  interest  thus 
paid  from  the  association  taking  or  receiving  the  same,  provided 
such  action  is  commenced  within  two  years  from  the  time  the 
usurious  transaction  occurred. 

Surplus  and  '09.  (Sec.  5199.)  The  directors  of  any  association  may  semi- 
dividends.  annually  declare  a  dividend  of  so  much  of  the  net  profits  of  the 
association  as  they  shall  judge  expedient;  but  each  association  shall, 
before  the  declaration  of  a  dividend,  carry  one-tenth  part  of  its 
net  profits  of  the  preceding  half  year  to  its  surplus  fund  until  the 
same  shall  amount  to  twenty  per  centum  of  its  capital  stock. 

Restriction  on  HO-  (Sec.  5200,  as  amended  June  22,  1906.)  The  total 
loans,  liabilities  to  any  association,  of  any  person,  or  of  any  company, 
corporation,  or  firm  for  money  borrowed,  including  in  the  liabilities 
of  a  company  or  firm  the  liabilities  of  the  several  members  thereof, 
shall  at  no  time  exceed  one-tenth  part  of  the  amount  of  the  capital 
stock  of  such  association,  actually  paid  in  and  unimpaired  and  one- 
tenth  part  of  its  unimpaired  surplus  fund:  Provided,  however.  That 
the  total  of  such  liabilities  shall  in  no  event  exceed  thirty  per  centum 


NATIONAL    BANK   ACT 103 

of  the  capital  stock  of  the  association.  But  the  discount  of  bills 
of  exchange  drawn  in  good  faith  against  actually  existing  values,  and 
the  discount  of  commercial  or  business  paper  actually  owned  by 
the  person  negotiating  the  same  shall  not  be  considered  as  money 
borrowed. 

111.  (Sec.  5201.)      No  association  shall  make  any  loan  or  Associations 
discount  on  the  security  of  the  shares  of  its  own  capital  stock,  nor  '""f '  "°'  "°'" 
be  the  purchaser  or  holder  of  any  such  shares,  unless  such  security  ^' 
or  purchase  shall  be  necessary  to  prevent  loss  upon  a  debt  previously 

contracted  in  good  faith;  and  stock  so  purchased  or  acquired 
shall,  within  six  months  from  the  time  of  its  purchase,  be  sold  or 
disposed  of  at  public  or  private  sale;  or,  in  default  thereof,  a 
receiver  may  be  appointed  to  close  up  the  business  of  the  association, 
according  to  section  fifty-two  hundred  and  thirty-four. 

112.  (Sec.   5202.)    No   association   shall   at  any  time  be   in-  Restriction  on 
debted,  or  in  any  way  liable,  to  an  amount  exceeding  the  amount  oanlis  liabUtty. 
of  its  capital  stock  at  such   time   actually  paid  in   and   remaining 
undiminished  by  losses  or  otherwise,  except  on  account  of  demands 

of  the  nature  following: 

First.    Notes    of    circulation. 

Second.   Moneys  deposited  with  or  collected  by  the  association. 

Third.  Bills  of  exchange  or  drafts  drawn  against  money  actually 
on  deposit  to  the  credit  of  the  association,  or  due  thereto. 

Fourth.     Liabilities  to  the  stockholders  of  the  association  for  div- 
idends and  reserve  profits. 

113.  (Sec.  5203.)    No  association  shall,  either  directly  or  in-  Improper  use  of 
directly,  pledge  or  hypothecate  any  of  its  notes  of  circulation  for  ^^^^  circulation. 
the  purpose  of  procuring  money  to  be  paid  in  on  its  capital  stock, 

or  to  be  used  in  its  banking  operations,  or  otherwise;  nor  shall  any 
association  use  its  circulating  notes,  or  any  part  thereof,  in  any  manner 
or  form,  to  create  or  increase  its  capital  stock. 

114.  (Sec.  5204.)  No  association,  or  any  member  thereof.  Unearned 
shall,  during  '  le  time  it  shall  continue  its  banking  operations,  with-  f.f.  j 
draw,  or  per  .lit  to  be  withdrawn,  either  in  the  form  of  dividends  ^ 

or  otherwise,   any   portion   of   its   capital.      If   losses   have   at   any 


104  N.    W.    HALSEY    &   CO. 


time  been  sustained  by  any  such  association  equal  to  or  exceeding  its 
undivided  profits  then  on  hand,  no  dividend  shall  be  made;  and  no 
dividend  shall  ever  be  made  by  any  association,  while  it  continues 
its  banking  operations,  to  an  amount  greater  than  its  net  profits 
then  on  hand,  deducting  therefrom  its  losses  and  bad  debts.  All 
debts  due  to  any  association,  on  which  interest  is  past  due  and 
unpaid  for  a  period  of  six  months,  unless  the  same  are  well  secured, 
and  in  process  of  collection,  shall  be  considered  bad  debts  within  the 
meaning  of  this  section.  But  nothing  in  this  section  shall  prevent 
the  reduction  of  the  capital  stock  of  the  association  under  section 
fifty-one  hundred  and  forty-three. 

Assessment  for  1|5.  (Sec.  5205.)  Every  association  which  shall  have  failed 
impairment  oj  j^  p^^y  ^p  j^^  capital  stock,  as  required  by  law,  and  every  associa- 
tion whose  capital  stock  shall  have  become  impaired  by  losses  or 
otherwise,  shall,  within  three  months  after  receiving  notice  thereof 
from  the  Comptroller  of  the  Currency,  pay  the  deficiency  in  the 
capital  stock,  by  assessment  upon  the  shareholders  pro  rata  for  the 
amount  of  capital  stock  held  by  each;  and  the  Treasurer  of  the 
United  States  shall  withhold  the  interest  upon  all  bonds  held  by 
him  in  trust  for  any  such  association,  upon  notification  from  the 
Comptroller  of  the  Currency,  until  otherwise  notified  by  him.  If  any 
such  association  shall  fail  to  pay  up  its  capital  stock,  and  shall  refuse 
to  go  into  liquidation,  as  provided  by  law,  for  three  months  after 
receiving  notice  from  the  Comptroller,  a  receiver  may  be  appointed 
to  close  up  the  business  of  the  association,  according  to  the  provisions 
of  section  fifty-two  hundred  and  thirty-four. 

Provision  for  ]  ]  6.  Sec.  4  of  the  act  of  June  30,  1 876,  provides  that  if  any 
enforcement  of  shareholder  or  shareholders  of  a  bank  shall  neglect  or  refuse,  after 
three  months'  notice,  to  pay  the  assessment,  as  provided  in  this 
section,  it  shall  be  the  duty  of  the  board  of  directors  to  cause  a 
sufficient  amout  of  the  capital  stock  of  such  shareholder  or  share- 
holders to  be  sold  at  public  auction  (after  thirty  days'  notice  shall 
be  given  by  posting  such  notice  of  sale  in  the  office  of  the  bank  and 
by  publishing  such  notice  in  a  newspaper  of  the  city  or  town  in 
which  the  bank  is  located,  or  in  a  newspaper  published  nearest 
thereto)  to  make  good  the  deficiency;  and  the  balance,  if  any,  shall 
be  returned  to  such  delinquent  shareholder  or  shareholders. 


NATIONAL    BANK    ACT 105 

117.  (Sec.  5206.)    No  association  shall  at  any  time  pay  out  Prohibition 

on  loans  or  discounts,  or  in  purchasing  drafts  or  bills  of  exchange,  against  uncurrent 

or  in  payment  of  deposits,   or  in  any  other  mode  pay  or  put  in  "°'"' 

circulation  the  notes  of  any  bank  or  banking  association  which  are 

not,  at  any  such  time,  receivable,  at  par,  on  deposit,  and  in  payment 

of  debts  by  the  association  so  paying  out  or  circulating  such  notes; 

nor  shall  any  association  knowingly  pay  out  or  put  in  circulation 

any  notes  issued  by  any  bank  or  banking  association  which  at  the 

time  of  such  paying  out  or  putting  in  circulation  is  not  redeeming  its 

circulating  notes  in  lawful  money  of  the  United  States. 

1 18.  (Sec.  5210.)   The  president  and  cashier  of  every  national  List  of 
banking  association  shall  cause  to  be  kept  at  all  times  a  full  and  shareholders. 
correct  list  of  the  names  and  residences  of  all  the  shareholders  in 

the  association,  and  the  number  of  shares  held  by  each,  in  the  office 

where  its  business  is  transacted.     Such  lists  shall  be  subject  to  the 

inspection  of  all  the  shareholders  and  creditors  of  the  association, 

and   the  officers  authorized  to   assess   taxes   under  State   authority,  V 

during    business    hours    of    each    day    in    which    business    may    be 

legally  transacted.     A  copy  of  such  list,  on  the  first  Monday  of  July 

of  each  year,  verified  by  the  oath  of  such  president  or  cashier,  shall 

be  transmitted  to  the  Comptroller  of  the  Currency. 

119.  (Sec.     5211.)   Every     association    shall     make     to     the  ^cp<""'s  o/ 
Comptroller  of  the  Currency  not  less  than  five  reports  during  each  ^°"  '  "'"• 
year,  according  to  the  form  which  may  be  prescribed  by  him,  verified 

by  the  oath  or  affirmation  of  the  president  or  cashier  of  such  associa- 
tion, and  attested  by  the  signature  of  at  least  three  of  the  directors. 
Each  such  report  shall  exhibit,  in  detail  and  under  appropriate 
heads,  the  resources  and  liabilities  of  the  association  at  the  close  of 
business  on  any  past  day  by  him  specified,  and  shall  be  transmitted 
to  the  Comptroller  within  five  days  after  the  receipt  of  a  request 
or  requisition  therefor  from  him,  and  in  the  same  form  in  which  it 
is  made  to  the  Comptroller  shall  be  published  in  a  newspaper 
published  in  the  place  where  such  association  is  established,  or  if 
there  is  no  newsoaper  in  the  place,  then  in  one  published  nearest 
thereto  in  the  same  county,  at  the  expense  of  the  association;  and 
such  proof  of  publication  shall  be  furnished  as  may  be  required 
by  the  Comptroller.      The  Comptroller  shall   also  have  power   to 


106 N.    W.    HALSEY    &   CO. 

call  for  special  reports  from  any  particular  association  whenever  in 
his  judgment  the  same  are  necessary  in  order  to  a  full  and  complete 
knowledge  of  its  condition. 

Verification  of  120.  The  act  of  February  26,  1881,  provides  that  the  oath  or 
such  reports  affirmation  required  by  section  fifty-two  hundred  and  eleven  of  the 
Revised  Statutes,  verifying  the  returns  made  by  national  banks 
to  the  Comptroller  of  the  Currency,  when  taken  before  a  notary 
public  properly  authorized  and  commissioned  by  the  State  in  which 
such  notary  resides  and  the  bank  is  located,  or  any  other  officer 
having  an  official  seal,  authorized  in  such  State  to  administer  oaths, 
shall  be  a  sufficient  verification  as  contemplated  by  said  section  fifty- 
two  hundred  and  eleven:  Provided,  That  the  officer  administering  the 
oath  is  not  an  officer  of  the  bank. 

Reports  of        121.    (Sec.  5212.)    In  addition  to  the  reports  required  by  the 

dividends  and   preceding  section,  each  association  shall  report  to  the  Comptroller 

earnings.    ^£  ^^  Currency,  within  ten  days  after  declaring  any  dividend,  the 

amount  of  such  dividend  and  the  amount  of  net  earnings  in  excess 

of  such  dividend.      Such  reports  shall  be  attested  by  the  oath  of 

the  president  or  cashier  of  the  association. 

Penalty  for  122.  (Sec.  5213.)  Every  association  which  fails  to  make  and 
failure  to  report,  transmit  any  report  required  under  either  of  the  two  preceding* 
sections  shall  be  subject  to  a  penalty  of  one  hundred  dollars  for 
each  day  after  the  periods,  respectively,  therein  mentioned,  that  it 
delays  to  make  and  transmit  its  report.  Whenever  any  association 
delays  or  refuses  to  pay  the  penalty  herein  imposed,  after  it  has 
been  assessed  by  the  Comptroller  of  the  Currency,  the  amount 
thereof  may  be  retained  by  the  Treasurer  of  the  United  States, 
upon  the  order  of  the  Comptroller  of  the  Currency,  out  of  the 
interest,  as  it  may  become  due  to  the  association,  on  the  bonds 
deposited  with  him  to  secure  circulation.  All  sums  of  money 
collected  for  penalties  under  this  section  shall  be  paid  into  the 
Treasury  of  the  United  States. 

Reports  of         123.  Sec.    6  of  the   act  of  June   30,    1876,    as   amended  by 

other  banks,    ^cts  of   March   3,    1901.   and  June   30,    1902,  provides   that  all 

banks  or  savings  companies  or  institutions  organized  under  authority 


NATIONAL    BANK    ACT 107 

of  any  act  of  Congress  to  do  business  in  the  District  of  Columbia 
shall  be,  and  are  hereby,  required  to  make  to  the  Comptroller 
of  the  Currency,  and  publish,  all  the  reports  which  national  banking 
associations  are  required  to  make  and  publish,  under  the  provisions 
of  sections  fifty-two  hundred  and  eleven,  fifty-two  hundred  and 
twelve,  and  fifty-two  hundred  and  thirteen  of  the  Revised  Statutes, 
and  shall  be  subject  to  the  same  penalties  for  failure  to  make  or 
publish  such  reports  as  are  therein  provided,  which  penalties  may  be 
collected  by  suit  before  the  supreme  court  of  the  District  of 
Columbia. 

124.  (Sec.  5219.)    Nothing  herein  shall  prevent  all  the  shares  State  taxation  of 
in   any    association    from   being   included   in   the   valuation   of   the  national  banf(s. 
personal  property  of  the  owner  or  holder  of  such  shares,  in  assessing 

taxes  imposed  by  authority  of  the  State  within  which  the  association 
is  located;  but  the  legislature  of  each  State  may  determine  and 
direct  the  manner  and  place  of  taxing  all  the  shares  of  national 
banking  associations  located  within  the  State,  subject  only  to  the  two 
restrictions,  that  the  taxation  shall  not  be  at  a  greater  rate  than  is 
assessed  upon  other  moneyed  capital  in  the  hands  of  individual 
citizens  of  such  State,  and  that  the  shares  of  any  national  banking 
association  owned  by  nonresidents  of  any  State  shall  be  taxed  in 
the  city  or  town  where  the  bank  is  located,  and  not  elsewhere. 
Nothing  herein  shall  be  construed  to  exempt  the  real  property  of 
associations  from  either  State,  county,  or  municipal  taxes,  to  the 
same  extent,  according  to  its  value,  as  other  real  property  is  taxed. 

125.  (Sec.  5240.)   The  Comptroller  of  the  Currency,  with  the  National-bank 
approval  of  the  Secretary  of  the  Treasury,  shall,  as  often  as  shall  be  examiners. 
deemed  necessary  or  proper,   appoint  a  suitable  person  or  persons 

to  make  an  examination  of  the  affairs  of  every  banking  association, 
who  shall  have  power  to  make  a  thorough  examination  into  all 
the  affairs  of  the  association,  and  in  doing  so  to  examine  any  of  the 
officers  and  agents  thereof  on  oath;  and  shall  make  a  full  and 
detailed  report  of  the  condition  of  the  association  to  the  Comptroller. 

126.  (Sec.   5240.)    But  no  person  shall  be  appointed  to  ex-   Qualification  for 
amine   the   affairs   of   any   banking   association   of   which   he   is   a   ^xamuier. 
director  or  other  officer. 


108  N.    W.    HAU5EY    &   CO. 

Compensation  127.  (Sec.  5240.)  All  persons  appointed  to  be  examiners  of 
of  examiners,  national  banks  not  located  in  the  redemption  cities  specified  in  section 
five  thousand  one  hundred  and  ninety-two  of  the  Revised  Statutes 
of  the  United  States,  or  in  any  one  of  the  States  of  Oregon,  Cali- 
fornia, and  Nevada,  or  in  the  Territories,  shall  receive  compensation 
for  such  examination  as  follows:  For  examining  national  banks 
having  a  capital  less  than  one  hundred  thousand  dollars,  twenty 
dollars;  those  having  a  capital  of  one  hundred  thousand  dollars 
and  less  than  three  hundred  thousand  dollars,  twenty-five  dollars; 
those  having  a  capital  of  three  hundred  thousand  dollars  and  less 
than  four  hundred  thousand  dollars,  thirty-five  dollars;  those  having 
a  capital  of  four  hundred  thousand  dollars  and  less  than  five  hundred 
thousand  dollars,  forty  dollars;  those  having  a  capital  of  five 
hundred  thousand  dollars  and  less  than  six  hundred  thousand  dollars, 
fifty  dollars;  those  having  a  capital  of  six  hundred  thousand  dollars 
and  over,  seventy-five  dollars;  which  amounts  shall  be  assessed 
by  the  Comptroller  of  the  Currency  upon,  and  paid  by,  the 
respective  association  so  examined,  and  shall  be  in  lieu  of  the 
compensation  and  mileage  heretofore  allowed  for  making  said 
examinations;  and  persons  appointed  to  make  examinations  of 
national  banks  in  the  cites  named  in  section  five  thousand  one 
hundred  and  ninety-two  of  the  Revised  Statutes  of  the  United  States, 
or  in  any  one  of  the  States  of  Oregon,  California,  and  Nevada,  or 
in  the  Territories,  shall  receive  such  compensation  as  may  be  fixed 
by  the  Secretary  of  the  Treasury  upon  the  recommendation  of  the 
Comptroller  of  the  Currency;  and  the  same  shall  be  assessed  and 
paid  in  the  manner  hereinbefore  provided. 

Examinations  128.  (Sec.  332.)  The  Comptroller  of  the  Currency,  in  addition 
m  District  of  j^  ^^  powers  conferred  upon  him  by  law  for  the  examination  of 
'^'  national  banks,  is  further  authorized,  whenever  he  may  deem  it  use- 
ful, to  cause  examination  to  be  made  into  the  condition  of  any  bank 
in  the  District  of  Columbia  organized  under  act  of  Congress.  The 
Comptroller,  at  his  discretion,  may  report  to  Congress  the  results  of 
such  examination.  The  expense  necessarily  incurred  in  any  such 
examination  shall  be  paid  out  of  any  appropriation  made  by  Congress 
for  special  bank  examinations. 


NATIONAL    BANK    ACT  109 

129.  (Sec.    5241.)    No    association   shall    be    subject    to    any  Limitation  of 
visitorial  powers  other  than  such  as  are  authorized  by  this  Title,  visitorial  poTvers. 
or  are  vested  in  the  courts  of  justice. 

130.  (Sec.   5243.)   All   banks  not  organized   and   transacting  Use  of 
business  under  the  national  currency  laws,  or  under  this  Title,  and  all  "National"   in 
persons  or  corporations  doing  the  business  of  bankers,  brokers,   or  ""S^- 
savings    institutions,    except   savings   banks   authorized   by   Congress 

to  use  the  word  "national"  as  a  part  of  their  corporate  name,  are 
prohibited  from  using  the  word  "national"  as  a  portion  of  the  name 
or  title  of  such  bank,  corporation,  firm,  or  partnership;  and  any 
violation  of  this  prohibition  committed  after  the  third  day  of 
September,  eighteen  hundred  and  seventy-three,  shall  subject  the 
party  chargeable  therewith  to  a  penalty  of  fifty  dollars  for  each  day 
during  which  it  is  permitted  or  repeated. 


Chapter  Six. 

EXTENSION  OF  CORPORATE  EXISTENCE. 

131.  The  act  of  July  12,  1882,  provides:  (Sec.  1)  That  any  Corporate 
national  banking  association  organized  under  the  acts  of  February  existence  ma^  be 
twenty-fifth,  eighteen  hundred  and  sixty-three,  June  third,  eighteen  extended. 
hundred  and  sixty-four,  and  February  fourteenth,  eighteen  hundred 
and  eighty,  or  under  sections  fifty-one  hundred  and  thirty-three,  fifty- 
one  hundred  and  thirty-four,  fitfy-one  hundred  and  thirty-five,  fifty- 
one  hundred  and  thirty-six,  and  fifty-one  hundred  and  fifty-four  of 
the  Revised  Statutes  of  the  United  States,  may,  at  any  time  within 
the  two  years  next  previous  to  the  date  of  the  expiration  of  its  cor- 
porate existence  under  present  law,  and  with  the  approval  of  the 
Comptroller  of  the  Currency,  to  be  granted  as  hereinafter  provided, 
extend  its  period  of  succession  by  amending  its  articles  of  association 
for  a  term  of  not  more  than  twenty  years  from  the  expiration  of  the 
period  of  succession  named  in  said  articles  of  association,  and  shall 
have  succession  for  such  extended  period,  unless  sooner  dissolved  by 
the  act  of  shareholders  owning  two-thirds  of  its  stock,  or  unless  its 
franchise  becomes  forfeited  by  some  violation  of  law,  or  unless  here- 
after modified  or  repealed. 


110 


N.    W.    HALSEY    &   CO. 


Consent  of  132.  (Sec.  2.)  That  such  amendment  of  said  articles  of  associa- 
ttvo-tnirds  tJon  shall  be  authorized  by  the  consent  in  writing  of  shareholders  own- 
necessar}).  j^^g  ^^^  |ggg  ^j^^^^  two-thirds  of  the  capital  stock  of  the  association;  and 
the  board  of  directors  shall  cause  such  consent  to  be  certified  under  the 
seal  of  the  association,  by  its  president  or  cashier,  to  the  Comptroller  of 
the  Currency,  accompanied  by  an  application  made  by  the  president  or 
cashier  for  the  approval  of  the  amended  articles  of  association  by 
the  Comptroller;  and  such  amended  articles  of  association  shall  not 
be  valid  until  the  Comptroller  shall  give  to  such  association  a  certifi- 
cate under  his  hand  and  seal  that  the  association  has  complied  with 
all  the  provisions  required  to  be  complied  with  and  is  authorized  to 
have  succession  for  the  extended  period  named  in  the  amended 
articles  of  association. 

Special  1 33.  (Sec.  3.)  That  upon  the  receipt  of  the  application  and  cer- 
examination  tificate  of  the  association  provided  for  in  the  preceding  section,  the 
^'  Comptroller  of  the  Currency  shall  cause  a  special  examination  to  be 
made,  at  the  expense  of  the  association,  to  determine  its  condition ;  and 
if  after  such  examination  or  otherwise  it  appears  to  him  that  said  asso- 
ciation is  in  a  satisfactory  condition,  he  shall  grant  his  certificate  of 
approval  provided  for  in  the  preceding  section,  or  if  it  appears  that  the 
condition  of  said  association  is  not  satisfactory,  he  shall  withhold  such 
certificate  of  approval. 

Status  not  134.  (Sec.  4.)  That  any  association  so  extending  the  period 
changed  b\)  ^f  jjg  succession  shall  continue  to  enjoy  all  the  rights  and  privileges 
and  immunities  granted  and  shall  continue  to  be  subject  to  all  the 
duties,  liabilities,  and  restrictions  imposed  by  the  Revised  Statutes 
of  the  United  States  and  other  acts  having  reference  to  national 
banking  associations,  and  it  shall  continue  to  be  in  all  respects  the 
identical   association   it  was  before   the   extension   of  its   period   of 


extension. 


succession. 


Dissenting         135.    (Sec.   5.)    That   when   any   national    banking    association 
shareholders   Jj^s  amended  its  articles  of  association  as  provided  in  this  act,  and 
ma})  i»ithdran>.    ^^^  Comptroller  has  granted  his  certificate  of  approval,  any  share- 
holder not  assenting  to  such  amendment  may  give  notice  in  writing 
to  the  directors,  within  thirty  days  from  the  date  of  the  certificate 
of  approval,   of  his   desire   to  withdraw   from  said   association,    in 


NATIONAL    BANK    ACT 111 

which  case  he  shall  be  entitled  to  receive  from  said  banking  asso- 
ciation the  value  of  the  shares  so  held  by  him,  to  be  ascertained 
by  an  appraisal  made  by  a  committee  of  three  persons,  one  to  be 
selected  by  such  shareholder,  one  by  the  directors,  and  the  third 
by  the  first  two;  and  in  case  the  value  so  fixed  shall  not  be 
satisfactory  to  any  such  shareholder,  he  may  appeal  to  the  Comp- 
troller of  the  Currency,  who  shall  cause  a  reappraisal  to  be  made, 
which  shall  be  final  and  binding;  and  if  said  reappraisal  shall 
exceed  the  value  fixed  by  said  committee,  the  bank  shall  pay  the 
expenses  of  said  reappraisal,  and  otherwise  the  appellant  shall  pay 
said  expenses;  and  the  value  so  ascertained  and  determined  shall 
be  deemed  to  be  a  debt  due,  and  be  forthwith  paid,  to  said  share- 
holder, from  said  bank;  and  the  shares  so  surrendered  and 
appraised  shall,  after  due  notice,  be  sold  at  public  sale,  within 
thirty  days  after  the  final  appraisal  provided  in  this  section: 
Provided,  that  in  the  organization  of  any  banking  association 
intended  to  replace  any  existing  banking  association,  and  retaining 
the  name  thereof,  the  holders  of  stock  in  the  expiring  association 
shall  be  entitled  to  preference  in  the  allotment  of  the  shares  of  the 
new  association  in  proportion  to  the  number  of  shares  held  by 
them  respectively  in  the  expiring  association. 

136.  The  act  of  Congress,  approved  April  12,   1902,  provides  Re-extension  oj 
that  the  Comptroller  of  the  Currency  is  hereby  authorized  in  the  corporate 
manner  provided  by,   and  under  the  conditions  and  limitations  of 

the  act  of  July  12,  1882,  to  extend  for  a  further  period  of  twenty 
years  the  charteir  of  any  national  banking  association  extended 
under  said  act  which  shall  desire  to  continue  its  existence  after 
the  expiration  of  its  charter. 

Chapter  Seven. 
LIQUIDATION  AND  RECEIVERSHIP. 

137.  (Sec.  5220.)   Any   association   may   go   into   liquidation   Tn>o-thirds  vote 
and  be  closed  by  the  vote  of  its  shareholders  owning  two-thirds  ^^Q^^i^'^d  for 

of  its  stock.  liquidation. 


112 N.    W.    HALSEY    &   CO. 

Notice  of  138.  (Sec.  5221.)  Whenever  a  vote  is  taken  to  go  into 
voluntary  liquidation  it  shall  be  the  duty  of  the  board  of  directors  to  cause 
Liqmaauon.  j^^jj^.^  ^f  jj^j,  ^^^^  jq  j^g  certified,  under  the  seal  of  the  association, 
by  its  president  or  cashier,  to  the  Comptroller  of  the  Currency, 
and  the  publication  thereof  to  be  made  for  a  period  of  tv^o  months 
in  a  newspaper  published  in  the  city  of  New  York,  and  also  in  a 
newspaper  published  in  the  city  or  town  in  which  the  association 
is  located,  or  if  no  newspaper  is  there  published,  then  in  the 
newspaper  published  nearest  thereto,  that  the  association  is  closing 
up  its  affairs,  arid  notifying  the  holders  of  its  notes  and  other 
creditors  to  present  the  notes  and  other  claims  against  the  association 
for  payment. 

Deposit  of  139.  (Sec.  5222.)  Within  six  months  from  the  date  of  the 
/flDj/u/  mone];.  ^^^^  ^^  ^^  -^^^^  liquidation  the  association  shall  deposit  with  the 
Treasurer  of  the  United  States  lawful  money  of  the  United  States 
sufficient  to  redeem  all  its  outstanding  circulation.  The  Treasurer 
shall  execute  duplicate  receipts  for  money  thus  deposited,  and 
deliver  one  to  the  association  and  the  other  to  the  Comptroller  of 
the  Currency,  stating  the  amount  received  by  him,  and  the  purpose 
for  which  it  has  been  received;  and  the  money  shall  be  paid  into 
the  Treasury  of  the  United  States,  and  placed  to  the  credit  of 
such  association  upon  redemption  account. 

No  deposit        140.    (Sec.   5223.)    An    association    which    is    in    good    faith 

required  for  vvinding  up  its  business  for  the  purpose  of  consolidating  with  another 

consoli  a  ion.  ^^^^^i^^^^^  gjj^n   poj.  j^g  required   to  deposit  lawful  money   for   its 

outstanding  circulation;    but  its  assets  and  liabilities  shall  be  reported 

by  the  association  with  which  it  is  in  process  of  consolidation. 

Bonds  of  141.  (Sec.  5224.)  Whenever  a  sufficient  deposit  of  lawful 
liquidating  money  to  redeem  the  outstanding  circulation  of  an  asso- 
banf(s.  ^.Jj^^Jqjj  proposing  to  close  its  business  has  been  made,  the 
bonds  deposited  by  the  association  to  secure  payment  of 
its  notes  shall  be  reassigned  to  it,  in  the  manner  prescribed 
by  section  fifty-one  hundred  and  sixty-two.  And  there- 
after the  association  and  its  shareholders  shall  stand  dis- 
charged from  all  liabilities  upon  the  circulating  notes,  and 


NATIONAL    BANK   ACT  113 


those  notes  shall  be  redeemed  at  the  Treasury  of  the 
United  States.  And  if  any  such  bank  shall  fail  to  make 
the  deposit  and  take  up  its  bonds  for  thirty  days  after 
the  expiration  of  the  time  specified,  the  Comptroller  of 
the  Currency  shall  have  power  to  sell  the  bonds  pledged 
for  the  circulation  of  said  bank  at  public  auction  in  New 
York  City,  and,  after  providing  for  the  redemption  and 
cancellation  of  said  circulation,  and  the  necessary  expenses 
of  the  sale,  to  pay  over  any  balance  remaining  to  the  bank 
or  its  legal  representatives. 

142.  Sec.  7  of  the  act  of  July  12,  1882,  provides  that  Banks  whose 
national  banking  associations  whose  corporate  existence  has  expired  existence  has 
or   shall   hereafter   expire,    and   which   do   not   avail   themselves   of    c^'''^"- 

the  provisions  of  this  act,  shall  be  required  to  comply  with  the 
provisions  of  sections  fifty-two  hundred  and  twenty-one  and  fifty-two 
hundred  and  twenty-two  of  the  Revised  Statutes  in  the  same 
manner  as  if  the  shareholders  had  voted  to  go  into  liquidation, 
as  provided  in  section  fifty-two  hundred  and  twenty  of  the  Revised 
Statutes;  and  the  provisions  of  sections  fifty-two  hundred  and 
twenty-four  and  fifty-two  hundred  and  twenty-five  of  the  Revised 
Statutes  shall  also  be  applicable  to  such  associations,  except  as 
modified  by  this  act;  and  the  franchise  of  such  associations  is 
hereby  extended  for  the  sole  purpose  of  liquidating  their  affairs 
until  such  affairs  are  finally  closed. 

143.  (Sec.  5226.)    Whenever  any  national  banking  association    Protest  of  bank 
fails  to  redeem  in  the  lawful  money  of  the  United  States  any  of    circulation. 

its  circulating  notes,  upon  demand  of  payment  duly  made  during 
the  usual  hours  of  business,  at  the  office  of  such  association,  the 
holder  may  cause  the  same  to  be  protested,  in  one  package  by  a 
notary  public,  unless  the  president  or  cashier  of  the  association 
whose  notes  are  presented  for  payment  offers  to  waive  demand  and 
notice  of  the  protest,  and,  in  pursuance  of  such  offer,  makes,  signs, 
and  delivers  to  the  party  making  such  demand  an  admission  in 
writing,  stating  the  time  of  the  demand,  the  amount  demanded, 
and  the  fact  of  the  nonpayment  thereof.  The  notary  public,  on 
making    such    protest,    or    upon    receiving    such    admission,    shall 


114  N.    W.    HALSEY    &   CO. 

forthwith  forward  such  admission  or  notice  of  protest  to  the  Comp- 
troller of  the  Currency,  retaining  a  copy  thereof.  If,  however, 
satisfactory  proof  is  produced  to  the  notary  pubHc  that  the  payment 
of  the  notes  demanded  is  restrained  by  order  of  any  court  of 
competent  jurisdiction,  he  shall  not  protest  the  same.  When  the 
holder  of  any  notes  causes  more  than  one  note  or  package  to  be 
protested  on  the  same  day,  he  shall  not  receive  pay  for  more  than 
one  protest. 

Bonds  forfeited  144.  (Sec.  5227.)  On  receiving  notice  that  any  national 
if  circulation  banking  association  has  failed  to  redeem  any  of  its  circu- 
is  dishonored.  Jating  notes,  as  specified  in  the  preceding  section,  the 
Comptroller  of  the  Currency,  with  the  concurrence  of  the 
Secretary  of  the  Treasury,  may  appoint  a  special  agent, 
of  whose  appointment  immediate  notice  shall  be  given  to 
such  association,  who  shall  immediately  proceed  to  ascer- 
tain whether  it  has  refused  to  pay  its  circulating  notes  in 
the  lawful  money  of  the  United  States,  when  demanded, 
and  shall  report  to  the  Comptroller  the  fact  so  ascertained. 
If  from  such  protest,  and  the  report  so  made,  the  Comp- 
troller is  satisfied  that  such  association  has  refused  to  pay 
its  circulating  notes  and  is  in  default,  he  shall,  within 
thirty  days  after  he  has  received  notice  of  such  failure, 
declare  the  bonds  deposited  by  such  association  forfeited 
to  the  United  States,  and  they  shall  thereupon  be  so 
forfeited. 

Bank  ma})  145.  (Sec.  5237.)  Whenever  an  association  against  which 
enjom  further  proceedings  have  been  instituted,  on  account  of  any  alleged  refusal 
proceedings.  ^^  redeem  its  circulating  notes  as  aforesaid,  denies  having  failed 
to  do  so,  it  may,  at  any  time  within  ten  days  after  it  has  been 
notified  of  the  appointment  of  an  agent,  as  provided  in  section 
fifty-two  hundred  and  twenty-seven,  apply  to  the  nearest  circuit, 
or  district,  or  Territorial  court  of  the  United  States  to  enjoin  further 
proceedings  in  the  premises;  and  such  court,  after  citing  the  Comp- 
troller of  the  Currency  to  show  cause  why  further  proceedings 
should  not  be  enjoined,  and  after  the  decision  of  the  court  or  finding 
of   the   jury   that   such   association   has   not   refused   to   redeem   its 


NATIONAL    BANK    ACT US 

circulating  notes,  when  legally  presented,  in  the  lawful  money  of 
the  United  States,  shall  make  an  order  enjoining  the  Comptroller, 
and  any  receiver  acting  under  his  direction,  from  all  further  pro- 
ceedings on  account  of  such  alleged  refusal. 

146.  (Sec.   736.)     All  proceedings  by  any  national  banking  Where 
association  to  enjoin  the  Comptroller  of  the  Currency,   under  the  proceedings 
provisions  of  any  law  relating  to  national  banking  associations,  shall  ^"^      ^      °"°    * 
be  had  in  the  district  where  such  association  is  located. 

147.  (Sec.  5228.)   After  a  default  on  the  part  of  an  asso-  Suspension  of 
ciation   to  pay   any   of   its   circulating  notes   has   been   ascertained  ^"^iness  after 
by  the  Comptroller,  and  notice  thereof  has  been  given  by  him  to 

the  association,  it  shall  not  be  lawful  for  the  association  suffering 
the  same  to  pay  out  any  of  its  notes,  discount  any  notes  or  bills, 
or  otherwise  prosecute  the  business  of  banking,  except  to  receive 
and  safely  keep  money  belonging  to  it,  and  to  deliver  special 
deposits. 

148.  (Sec.  5229.)  Immediately  upon  declaring  the  bonds  Notice  to  present 
of  an  association  forfeited  for  nonpayment  of  its   notes,  circulation  for 
the  Comptroller  shall  give  notice,  in  such  manner  as  the  redemption. 
Secretary  of  the  Treasury  shall,  by  general  rules  or  other- 
wise direct,  to  the  holders  of  the  circulating  notes  of  such 
association,  to  present  them  for  payment  at  the  Treasury 

of  the  United  States;  and  the  same  shall  be  paid  as 
presented  in  lawful  money  of  the  United  States;  where- 
upon the  Comptroller  may,  in  his  discretion,  cancel  an 
amount  of  bonds  pledged  by  such  association  equal  at 
current  market  rates,  not  exceeding  par,  to  the  notes  paid. 

149.  (Sec.  5230.)  Whenever  the  Comptroller  has  become  Bonds  sold  at 
satisfied,  by  the  protest  or  the  waiver  and  admission  public  auction. 
specified  in  section  fifty-two  hundred  and  twenty-six,  or 
by  the  report  provided  for  in  section  fifty-two  hundred 
and  twenty-seven,  that  any  association  has  refused  to  pay 
its  circulating  notes,  he  may,  instead  of  canceling  its 
bonds,  cause  so  much  of  them  as  may  be  necessary  to 
redeem  its  outstanding  notes  to  be  sold  at  public  auction 


116 N.    W.    HALSEY    &   CO. 

in  the  city  of  New  York,  after  giving  thirty  days*  notice 
of  such  sale  to  the  association. 

First  lien  for  150.  (Sec.  5230.)  For  any  deficiency  in  the  proceeds  of  all 
redeeming  the  bonds  of  an  association,  when  thus  sold,  to  reimburse  to  the 
circulation.  UjjJted  States  the  amount  expended  in  paying  the  circulating  notes 
of  the  association,  the  United  States  shall  have  a  paramount  lien 
upon  all  its  assets;  and  such  deficiency  shall  be  made  good  out  of 
such  assets  in  preference  to  any  and  all  other  claims  whatsoever, 
except  the  necessary  costs  and  expenses  of  administering  the  same. 

Bonds  sold  at  151.  (Sec.  5231.)  The  Comptroller  may,  if  he  deems  it 
private  sale.  £qj.  ^jje  interest  of  the  United  States,  sell  at  private  sale 
any  of  the  bonds  of  an  association  shown  to  have  made 
default  in  paying  its  notes,  and  receive  therefor  either 
money  or  the  circulating  notes  of  the  association.  But 
no  such  bonds  shall  be  sold  by  private  sale  for  less  than 
par,  nor  for  less  than  the  market  value  thereof  at  the  time 
of  sale;  and  no  sales  of  any  such  bonds,  either  public  or 
private,  shall  be  complete  until  the  transfer  of  the  bonds 
shall  have  been  made  with  the  formalities  prescribed  by 
sections  fifty-one  hundred  and  sixty-two,  fifty-one  hundred 
and  sixty-three,  and  fifty-one  hundred  and  sixty-four. 

Appointment  152.  (Sec.  5234.)  On  becoming  satisfied,  as  specified  in  sec- 
ana  duties  of  tions  fifty-two  hundred  and  twenty-six  and  fifty-two  hundred  and 
receiver,  twenty-seven,  that  any  association  has  refused  to  pay  its  circulating 
notes  as  therein  mentioned,  and  is  in  default,  the  Comptroller  of 
the  Currency  may  forthwith  appoint  a  receiver,  and  require  of  him 
such  bond  and  security  as  he  deems  proper.  Such  receiver,  under 
the  direction  of  the  Comptroller,  shall  take  possession  of  the  books, 
records,  and  assets  of  every  description  of  such  association,  collect 
all  debts,  dues,  and  claims  belonging  to  it,  and,  upon  the  order  of  a 
court  of  record  of  competent  jurisdiction,  may  sell  or  compound  all 
bad  or  doubtful  debts,  and,  on  a  like  order,  may  sell  all  the  real  and 
personal  property  of  such  association,  on  such  terms  as  the  court 
shall  direct;  and  may,  if  necessary  to  pay  the  debts  of  such 
association,  enforce  the  individual  liability  of  the  stockholders.  Such 
receiver   shall   pay   over   all  money   so   made   to   the   Treasurer   of 


NATIONAL    BANK    ACT  117 

the  United  States,  subject  to  the  order  of  the  Comptroller,  and 
also  make  report  to  the  Comptroller  of  all  his  acts  and  proceedings. 

153.  Sec.   1   of  the  act  of  June  30,   1876,  provides  that  when-  When  receiver 
ever  any   national   banking  association   shall   be  dissolved,    and   its  ^^^  Y^ 
rights,   privileges,    and   franchises   declared   forfeited,    as   prescribed 

in  section  fifty-tw^o  hundred  and  thirty-nine  of  the  Revised  Statutes 
of  the  United  States,  or  whenever  any  creditor  of  any  national 
banking  association  shall  have  obtained  a  judgment  against  it  in 
any  court  of  record,  and  made  application,  accompanied  by  a 
certificate  from  the  clerk  of  the  court  stating  that  such  judgment 
has  been  rendered  and  has  remained  unpaid  for  the  space  of 
thirty  days,  or  whenever  the  Comptroller  shall  become  satisfied 
of  the  insolvency  of  the  national  banking  association,  he  may,  after 
due  examination  of  its  affairs,  in  either  case,  appoint  a  receiver, 
who  shall  proceed  to  close  up  such  association,  and  enforce  the 
personal  liability  of  the  shareholders,  as  provided  in  section  fifty- 
two  hundred  and  thirty-four  of  said  statutes. 

A  receiver  may  also  be  appointed,  under  the  provisions  of 
section  fifty-two  hundred  and  thirty-four  of  the  Revised  Statutes 
of  the  United  States,  for  the  following  violations  of  law: 

Where  the  capital  stock  of  a  national  bank  has  not  been  fully 
paid  in  and  it  is  thus  reduced  below  the  legal  minimum  and 
remains  so  for  thirty  days.      (Sec.  5141,  R.  S.) 

For  failure  to  make  good  the  lawful-money  reserve  within  thirty 
days  after  notice.      (Sec.  5191,  R.  S.) 

Where  a  bank  purchases  or  acquires  its  own  stock,  to  prevent 
loss  upon  a  debt  previously  contracted  in  good  faith,  and  the  same 
is  not  sold  or  disposed  of  within  six  months  from  the  time  of  its 
purchase.      (Sec.  5201,  R.  S.) 

For  failure  to  make  good  any  impairment  in  its  capital  stock 
and  refusing  to  go  into  liquidation  within  three  months  after 
receiving  notice.      (Sec.  5205,  R.  S.) 

For  false  certification  of  checks  by  any  officer,  clerk,  or  agent. 
(Sec.  5208,  R.  S.) 

154.  (Sec.   5235.)   The  Comptroller  shall,  upon  appointing  a   (.f^JiiQ^^  qj 
receiver,    cause    notice    to    be    given,    by    advertisement    in    such  insolvent  bankS' 


118  N.    W.    HALSEY    &   CO. 

newspapers  as  he  may  direct,  for  three  consecutive  months,  calHng  on 
all  persons  who  may  have  claims  against  such  association  to  present 
the  same  and  to  make  legal  proof  thereof. 

Distribution  of  155.  (Sec.  5236.)  From  time  to  time,  after  full  provision  has 
assets  of  been  first  made  for  refunding  to  the  United  States  any  deficiency 
msoLveni  cantos.  -^^  redeeming  the  notes  of  such  association,  the  Comptroller  shall 
make  a  ratable  dividend  of  the  money  so  paid  over  to  him  by 
such  receiver  on  all  such  claims  as  may  have  been  proved  to  his 
satisfaction  or  adjudicated  in  a  court  of  competent  jurisdiction,  and, 
as  the  proceeds  of  the  assets  of  such  association  are  paid  over  to 
him,  shall  make  further  dividends  on  all  claims  previously  proved 
or  adjudicated;  and  the  remainder  of  the  proceeds,  if  any,  shall 
be  paid  over  to  the  shareholders  of  such  association,  or  their  legal 
representatives,  in  proportion  to  the  stock  by  them  respectively  held. 

Expenses  of  156.  (Sec.  5238.)  All  fees  for  protesting  the  notes  issued  by 
Teceivership—-  ^jjy  national  banking  association  shall  be  paid  by  the  person 
'  procuring  the  protest  to  be  made,  and  such  association  shall  be 
liable  therefor;  but  no  part  of  the  bonds  deposited  by  such  asso- 
ciation shall  be  applied  to  the  payment  of  such  fees.  All  expenses 
of  any  preliminary  or  other  examinations  into  the  condition  of  any 
association  shall  be  paid  by  such  association.  All  expenses  of 
any  receivership  shall  be  paid  out  of  the  assets  of  such  association 
before  distribution  of  the  proceeds  thereof. 

Forfeiture  of  157.  (Sec.  5239.)  If  the  directors  of  any  national  banking 
charter,  association  shall  knowingly  violate,  or  knowingly  permit  any  of 
the  officers,  agents,  or  servants  of  the  association  to  violate,  any 
of  the  provisions  of  this  Title,  all  the  rights,  privileges,  and  fran- 
chises of  the  association  shall  be  thereby  forfeited.  Such  violation 
shall,  however,  be  determined  and  adjudged  by  a  proper  circuit, 
district,  or  Territorial  court  of  the  United  States,  in  a  suit  brought 
for  that  purpose  by  the  Comptroller  of  the  Currency,  in  his  own 
name,  before  the  association  shall  be  declared  dissolved. 

Individual      158.    (Sec.  5239.)   And    in    cases    of    such    violation    every 

liability  o/ director  who  participated  in  or  assented  to  the  same  shall  be  held 

directors.  jjj^Hjjg    in    his    personal    and    individual    capacity    for    all    damages 


NATIONAL    BANK    ACT  119 


which  the  association,  its  shareholders,   or  any  other  person   shall 
have  sustained  in  consequence  of  such  violation. 

159.  The  act  of  March  29,  1886,  provides:  (Sec.  1.)  That  Receiver  ma\f 
whenever  the  receiver  of  any  national  bank  duly  appointed  by  the  Purchase  property 
Comptroller  of  the  Currency,  and  who  shall  have  duly  qualified  °  '^  °  ^^ 
and  entered  upon  the  discharge  of  his  trust,  shall  find  it  in  his 
opinion  necessary,  in  order  to  fully  protect  and  benefit  his  said 
trust,  to  the  extent  of  any  and  all  equities  that  such  trust  may 
have  in  any  property,  real  or  personal,  by  reason  of  any  bond, 
mortgage,  assignment,  or  other  proper  legal  claim  attaching  thereto, 
and  which  said  property  is  to  be  sold  under  any  execution,  decree 
of  foreclosure,  or  proper  order  of  any  court  of  jurisdiction,  he 
may  certify  the  facts  in  the  case,  together  with  his  opinion  as  to 
the  value  of  the  property  to  be  sold  and  the  value  of  the  equity 
his  said  trust  may  have  in  the  same,  to  the  Comptroller  of  the 
Currency,  together  with  a  request  for  the  right  and  authority  to 
use  and  employ  so  much  of  the  money  of  said  trust  as  may  be 
necessary  to  purchase  such  property  at  such  sale. 

Sec.  2.  That  such  request,  if  approved  by  the  Comptroller  of 
the  Currency,  shall  be,  together  with  the  certificate  of  facts  in  the 
case  and  his  recommendation  as  to  the  amount  of  money  which  in 
his  judgment  should  be  so  used  and  employed,  submitted  to  the 
Secretary  of  the  Treasury,  and  if  the  same  shall  likewise  be 
approved  by  him  the  request  shall  be  by  the  Comptroller  of  the 
Currency  allowed,  and  notice  thereof,  with  copies  of  the  request, 
certificate  of  facts,  and  indorsement  of  approvals,  shall  be  filed 
with  the  Treasurer  of  the  United  States. 

Sec.  3.  That  whenever  any  such  request  shall  be  allowed  as 
hereinbefore  provided,  the  said  Comptroller  of  the  Currency  shall 
be,  and  is,  empowered  to  draw  upon  and  from  such  funds  of  any 
such  trust  as  may  be  deposited  with  the  Treasurer  of  the  United 
States  for  the  benefit  of  the  bank  in  interest  to  the  amount  as  may 
be  recommended  and  allowed  and  for  the  purpose  for  which  such 
allowance  was  made:  Provided,  however.  That  all  payments  to  be 
made  for  or  on  account  of  the  purchase  of  any  such  property  and 
under  any  such  allowance  shall  be  made  by  the  Comptroller  of  the 


120 


N.    W.    HALSEY    &   CO. 


Currency  direct,  with  the  approval  of  the  Secretary  of  the  Treasury, 
for  such  purpose  only  and  in  such  manner  as  he  may  determine 
and  order. 

Taxes  on        ]  60.  The  act  of  March   1,   1879,  provides  that  whenever  and 

..       II      .      after  any  bank  has  ceased  to  do  business  by  reason  of  insolvency 
national  banks         .      .  ,    „  ,  i  n        i  •  i   • 

remilied.    '^^  bankruptcy  no  tax  shall  be  assessed  or  collected,  or  paid  mto 

the  Treasury  of  the  United  States,  on  account  of  such  bank,  which 

shall  diminish  the  assets  thereof  necessary  for  the  full  payment  of 

all  its  depositors;    and  such  tax  shall  be  abated  from  such  national 

banks   as   are   found   by   the   Comptroller   of   the   Currency   to   be 

insolvent;     and   the   Commissioner   of   Internal   Revenue,   when   the 

facts  shall  so  appear  to  him,  is  authorized  to  remit  so  much  of  said 

tax  against  insolvent  State  and  savings  banks  as  shall  be  found  to 

affect  the  claims  of  their  depositors. 


Appointment 

and  qualification 

of  shareholders' 

agent. 


161.  Sec.  3  of  the  act  of  June  30,  1876,  as  amended  by  acts 
of  August  3,  1892,  and  March  2,  1897,  provides  that  whenever 
any  association  shall  have  been  or  shall  be  placed  in  the  hands 
of  a  receiver,  as  provided  in  section  fifty-two  hundred  and  thirty- 
four  and  other  sections  of  the  Revised  Statutes  of  the  United 
States,  and  when,  as  provided  in  section  fifty-two  hundred  and 
thirty-six  thereof,  the  Comptroller  of  the  Currency  shall  have  paid  to 
each  and  every  creditor  of  such  association,  not  including  share- 
holders who  are  creditors  of  such  association,  whose  claim  or 
claims  as  such  creditor  shall  have  been  proved  or  allowed  as  therein 
prescribed,  the  full  amount  of  such  claims,  and  all  expenses  of 
the  receivership  and  the  redemption  of  the  circulating  notes  of  such 
association  shall  have  been  provided  for  by  depositing  lawful  money 
of  the  United  States  with  the  Treasurer  of  the  United  States,  the 
Comptroller  of  the  Currency  shall  call  a  meeting  of  the  share- 
holders of  such  association  by  giving  notice  thereof  for  thirty  days 
in  a  newspaper  published  in  the  town,  city,  or  county  where  the 
business  of  such  association  was  carried  on,  or  if  no  newspaper  is 
there  published,  in  the  newspaper  published  nearest  thereto.  At 
such  meeting  the  shareholders  shall  determine  whether  the  receiver 
shall  be  continued  and  shall  wind  up  the  affairs  of  such  association, 
or  whether  an  agent  shall  be  elected  for  that  purpose,   and  in  so 


NATIONAL    BANK   ACT 121 

determining  the  said  shareholders  shall  vote  by  ballot,  in  person 
or  by  proxy,  each  share  of  stock  entitling  the  holder  to  one  vote, 
and  the  majority  of  the  stock  in  value  and  number  of  shares  shall  be 
necessary  to  determine  whether  the  said  receiver  shall  be  continued, 
or  whether  an  agent  shall  be  elected.  In  case  such  majority  shall 
determine  that  the  said  receiver  shall  be  continued,  the  said 
receiver  shall  thereupon  proceed  with  the  execution  of  his  trust, 
and  shall  sell,  dispose  of,  or  otherwise  collect  the  assets  of  the 
said  association,  and  shall  possess  all  the  powers  and  authority, 
and  be  subject  to  all  the  duties  and  liabilities  originally  conferred 
or  imposed  upon  him  by  his  appointment  as  such  receiver,  so  far 
as  the  same  remain  applicable.  In  case  the  said  meeting  shall, 
by  the  vote  of  a  majority  of  the  stock  in  value  and  number  of 
shares,  determine  that  an  agent  shall  be  elected,  the  said  meeting 
shall  thereupon  proceed  to  elect  an  agent,  voting  by  ballot,  in 
person  or  by  proxy,  each  share  of  stock  entitling  the  holder  to 
one  vote,  and  the  person  who  shall  receive  votes  representing  at 
least  a  majority  of  stock  in  value  and  number  shall  be  declared 
the  agent  for  the  purposes  hereinafter  provided;  and  whenever  any 
of  the  shareholders  of  the  association  shall,  after  the  election  of 
such  agent,  have  executed  and  filed  a  bond  to  the  satisfaction  of 
the  Comptroller  of  the  Currency,  conditioned  for  the  payment  and 
discharge  in  full  of  each  and  every  claim  that  may  hereafter  be 
proved  and  allowed  by  and  before  a  competent  court,  and  for  the 
faithful  performance  of  all  and  singular  the  duties  of  such  trust, 
the  Comptroller  and  the  receiver  shall  thereupon  transfer  and 
deliver  to  such  agent  all  the  undivided  or  uncollected  or  other  assets 
of  such  association  then  remaining  in  the  hands  or  subject  to  the 
order  and  control  of  said  Comptroller  and  said  receiver,  or  either 
of  them;  and  for  this  purpose  said  Comptroller  and  said  receiver 
are  hereby  severally  empowered  and  directed  to  execute  any  deed, 
assignment,  transfer,  or  other  instrument  in  writing  that  may  be 
necessary  and  proper;  and  upon  the  execution  and  delivery  of 
such  instrument  to  the  said  agent  the  said  Comptroller  and  the  said 
receiver  shall  by  virtue  of  this  act  be  discharged  from  any  and 
all  liabilities  to  such  association  and  to  each  and  all  the  creditors 
and  shareholders  thereof. 


122  N.    W.    HALSEY    &   CO. 


Duties  of  1 62.  Sec.  3  of  the  act  of  June  30,  1 876,  as  amended  by  acts 
shareholders  of  August  3,  1892,  and  March  2,  1897,  provides:  Upon 
^°^  '  receiving  such  deed,  assignment,  transfer,  or  other  instrument,  the 
person  elected  such  agent  shall  hold,  control,  and  dispose  of  the 
assets  and  property  of  such  association  which  he  may  receive  under 
the  terms  hereof  for  the  benefit  of  the  shareholders  of  such  asso- 
ciation, and  he  may,  in  his  own  name,  or  in  the  name  of  such 
association,  sue  and  be  sued  and  do  all  other  lawful  acts  and 
things  necessary  to  finally  settle  and  distribute  the  assets  and  prop- 
erty in  his  hands,  and  may  sell,  compromise,  or  compound  the 
debts  due  to  such  association,  with  the  consent  and  approval  of  the 
circuit  or  district  court  of  the  United  States  for  the  district  where 
the  business  of  such  association  was  carried  on,  and  shall  at  the 
conclusion  of  his  trust  render  to  such  district  or  circuit  court  a 
full  account  of  all  his  proceedings,  receipts,  and  expenditures  as 
such  agent,  which  court  shall,  upon  due  notice,  settle  and  adjust 
such  accounts  and  discharge  said  agent  and  the  sureties  upon  said 
bond.  And  in  case  any  such  agent  so  elected  shall  refuse  to  serve, 
or  die,  resign,  or  be  removed,  any  shareholder  may  call  a  meeting 
of  the  shareholders  of  such  association  in  the  town,  city,  or  village 
where  the  business  of  the  said  association  was  carried  on,  by 
giving  notice  thereof  for  thirty  days  in  a  newspaper  published  in  said 
town,  city,  or  village,  or  if  no  newspaper  is  there  published,  in 
the  newspaper  published  nearest  thereto,  at  which  meeting  the 
shareholders  shall  elect  an  agent,  voting  by  ballot,  in  person  or  by 
proxy,  each  share  of  stock  entitling  the  holder  to  one  vote,  and 
when  such  agent  shall  have  received  votes  representing  at  least  a 
majority  of  the  stock  in  value  and  number  of  shares,  and  shall 
have  executed  a  bond  to  the  shareholders  conditioned  for  the 
faithful  performance  of  his  duties,  in  the  penalty  fixed  by  the 
shareholders  at  said  meeting,  with  two  sureties,  to  be  approved 
by  a  judge  of  a  court  of  record,  and  file  said  bond  in  the  office 
of  the  clerk  of  a  court  of  record  in  the  county  where  the  business 
of  said  association  was  carried  on,  he  shall  have  all  the  rights, 
powers,  and  duties  of  the  agent  first  elected  as  hereinbefore  provided. 
At  any  meeting  held  as  hereinbefore  provided  administrators  or 
executors  of  deceased  shareholders  may  act  and  sign  as  the  decedent 


NATIONAL    BANK    ACT  123 


might  have  done  if  living,  and  guardians  of  minors  and  trustees 
of  other  persons  may  so  act  and  sign  for  their  ward  or  wards  or 
cestui  que  trust.  The  proceeds  of  the  assets  or  property  of  any 
such  association  which  may  be  undistributed  at  the  time  of  such 
meeting  or  may  be  subsequently  received  shall  be  distributed  as 
follows : 

"First.  To  pay  the  expenses  of  the  execution  of  the  trust  to  the 
date  of  such  payment. 

"Second.  To  repay  any  amount  or  amounts  which  have  been 
paid  in  by  any  shareholder  or  shareholders  of  such  association  upon 
and  by  reason  of  any  and  all  assessments  made  upon  the  stock 
of  such  association  by  the  order  of  the  Comptroller  of  the  Currency 
in  accordance  with  the  provisions  of  the  statutes  of  the  United 
States ;    and 

"Third.  The  balance  ratably  among  such  stockholders,  in  pro- 
portion to  the  number  of  shares  held  and  owned  by  each.  Such 
distribution  shall  be  made  from  time  to  time  as  the  proceeds  shall 
be  received  and  as  shall  be  deemed  advisable  by  the  said  Comp- 
troller or  said  agent." 

163.  (Sec.  5242.)  All  transfers  of  the  notes,  bonds,  bills  of   m^goi  preference 
exchange,  or  other  evidences  of  debt  owing  to  any  national  banking    of  creditors, 
association,  or  of  deposits  to  its  credit;    all  assignments  of  mort- 
gages,  sureties  on   real   estate,   or  of  judgments  or   decrees  in   its 

favor;  all  deposits  of  money,  bullion,  or  other  valuable  thing  for 
its  use,  or  for  the  use  of  any  of  its  shareholders  or  creditors;  and 
all  payments  of  money  to  either,  made  after  the  commission  of  an 
act  of  insolvency,  or  in  contemplation  thereof,  made  with  a  view 
to  prevent  the  application  of  its  assets  in  the  manner  prescribed  by 
this  chapter,  or  with  a  view  to  the  preference  of  one  creditor  to 
another,  except  in  payment  of  its  circulating  notes,  shall  be  utterly 
null  and  void.  No  attachment,  injunction,  or  execution  shall  be 
issued  against  such  association  or  its  property  before  final  judgment 
in  any  suit,  action,  or  proceeding  in  any  State,  county,  or  municipal 
court. 

164.  Sec.  2  of  the  act  of  June  30,   1876,  provides  that  when  .    . 

any  national  banking  association  shall   have  gone  into   liquidation    shareholders. 


124  N.    W.    HALSEY    &   CO. 


under  the  provisions  of  section  five  thousand  two  hundred  and 
twenty  of  said  statutes,  the  individual  liability  of  the  shareholders 
provided  for  by  section  fifty-one  hundred  and  fifty-one  of  said 
statutes  may  be  enforced  by  any  creditor  of  such  association,  by 
bill  in  equity  in  the  nature  of  a  creditor's  bill,  brought  by  such 
creditor  on  behalf  of  himself  and  of  all  other  creditors  of  the  asso- 
ciation, against  the  shareholders  thereof,  in  any  court  of  the  United 
States  having  original  jurisdiction  in  equity  for  the  district  in 
which  such  association  may  have  been  located  or  established. 


Chapter  Eight. 
CRIMES.   JURISDICTION.    ETC. 

Penalty  for        165.    (Sec.  5187.)    No  officer  acting  under  the  provisions  of 

imp  ope     jjjjg  Title  shall  countersign  or  deliver  to  any  association,  or  to  any 
countersigning      .  •      i    •  i      i   i 

or  deliverins   ^"^^^  company   or  person,    any   circulatmg   notes   contemplated    by 

circulation.    ^^^  Title,  except  in  accordance  with  the  true  intent  and  meaning 

of  its  provisions.      Every  officer  who  violates  this  section  shall  be 

deemed  guilty  of  a  high  misdemeanor,  and  shall  be  fined  not  more 

than    double    the    amount    so    countersigned    and    delivered,    and 

imprisoned  not  less  than  one  year  and  not  more  than  fifteen  years. 

Penalty)  for        |66.    (Sec.   5207.)    No    association    shall    hereafter    offer    or 

pledging  United    j-gceive  United  States   notes  or  national-bank  notes   as   security  or 

otates  notes  or  n  .      i  -^    r  i  r  r  •  1        • 

banh  cir     I  It  n     ^^  collateral  security  tor  any  loan  or  money,  or  for  a  consideration 

agree  to  withhold  the  same  from  use,  or  offer  or  receive  the  custody 

or  promise  of  custody  of  such   notes   as  security,   or   as   collateral 

security,  or  consideration  for  any  loan  of  money.     Any  association 

offending   against   the   provisions   of    this   section    shall   be   deemed 

guilty   of  a  misdemeanor,   and   shall   be   fined   not  more   than   one 

thousand  dollars  and  a  further  sum  equal  to  one-third  of  the  money 

so   loaned.      The  officer  or  officers   of   any   association   who   shall 

make  any  such   loan   shall  be   liable   for   a   further  sum   equal   to 

one-quarter  of  the  money  loaned;    and  any  fine  or  penalty  incurred 

by  a  violation  of  this  section  shall  be  recoverable  for  the  benefit 

of  the  party  bringing  such  suit.     Sec.    12  of  the  act  of  July   12, 


NATIONAL    BANK   ACT 125 

1882,  provides  that  the  provisions  of  this  section  shall  apply  to 
the  United  States  certificates  of  gold  and  silver  coin. 

167.  (Sec.  5188.)    It  shall  not  be  lawful  to  design,  engrave.   Penally  for 

print,  or  in  any  manner  make  or  execute,  or  to  utter,  issue,  distribute,   iniitatmg  banii 

circulate,  or  use  any  business  or  professional  card,  notice,  placard^      ,      ...     ' 
I        1       11  11  1       •  111  -v     I       f  advertising 

circular,  handbill,  or  advertisement  in  the  likeness  or  similitude  or   purpose*. 

any  circulating  note  or  other  obligation  or  security  of  any  banking 

association  organized  or  acting  under  the  laws  of  the  United  States 

which  has  been  or  may  be  issued  under  this  Title,  or  any  act  of 

Congress,  or  to  write,  print,  or  otherwise  impress  upon  any  such 

note,    obligation,    or    security    any    business    or    professional    card, 

notice,    or   advertisement,    or   any   notice   or    advertisement   of    any 

matter  or  thing  whatever.     Every  person  who  violates  this  section 

shall  be  liable  to  a  penalty  of  one  hundred  dollars,   recoverable 

one-half  to  the  use  of  the  informer. 

168.  (Sec.  5189.)    Every  person  who  mutilates,  cuts,  defaces.   Penalty  for 
disfigures,  or  perforates  with  holes,  or  unites  or  cements  together,   "i""'^"[i? 
or   does  any  other   thing  to  any  bank  bill,   draft,   note,   or  other 

evidence  of  debt,  issued  by  any  national  banking  association,  or 
who  causes  or  procures  the  same  to  be  done,  with  intent  to  render 
such  bank  bill,  draft,  note,  or  other  evidence  of  debt  unfit  to  be 
reissued  by  said  association,  shall  be  liable  to  a  penalty  of  fifty 
dollars,  recoverable  by  the  association. 

169.  (Sec.  5415.)   Every  person  who   falsely  makes,   forges.  Penalty  for 
or    counterfeits,    or    causes    or    procures    to    be    made,    forged,    or  counterfeiting 
counterfeited,  or  willingly  aids  or  assists  in  falsely  making,  forging,  ^  ^"  ^  '*'"• 
or  counterfeiting,  any  note  in  imitation  of,  or  purporting  to  be  in 

imitation  of,  the  circulating  notes  issued  by  any  banking  association 
now  or  hereafter  authorized  and  acting  under  the  laws  of  the 
United  States;  or  who  passes,  utters,  or  publishes,  or  attempts  to 
pass,  utter,  or  publish,  any  false,  forged,  or  counterfeited  note 
purporting  to  be  issued  by  any  such  association  doing  a  banking 
business,  knowing  the  same  to  be  falsely  made,  forged,  or  counter- 
feited, or  who  falsely  alters,  or  causes  or  procures  to  be  falsely 
altered,   or   willingly   aids   or   assists   in   falsely   altering   any   such 


126 N.    W.    HALSEY    &   CO. 

circulating  notes,  or  passes,  utters,  or  publishes,  or  attempts  to  pass, 
utter,  or  publish  as  true,  any  falsely  altered  or  spurious  circulating 
note  issue,  or  purporting  to  have  been  issued,  by  any  such  banking 
association,  knowing  the  same  to  be  falsely  altered  or  spurious, 
shall  be  imprisoned  at  hard  labor  not  less  than  five  years  nor  more 
than  fifteen  years,  and  fined  not  more  than  one  thousand  dollars. 


What  are  170.  (Sec.  5413.)  The  v^ords  "obligation  or  other  security  of 
^  ofc(«ga'ions  of  ^^  Uj^jj^j  States"  shall  be  held  to  mean  all  bonds,  certificates  of 
indebtedness,  national-bank  currency,  coupons.  United  States  notes, 
Treasury  notes,  fractional  notes,  certificates  of  deposit,  bills,  checks, 
or  drafts  for  money  drawn  by  or  upon  authorized  officers  of  the 
United  States,  stamps  and  other  representatives  of  value,  of  what- 
ever denomination,  which  have  been  or  may  Ibe]  issued  under 
any  act  of  Congress. 

Penalt\ffor        171.    (Sec.  5430.)   Every  person  having  control,   custody,   or 

illegal   possession  of  any  plate,  or  any  part  thereof,  from  which  has  been 

±       I    •  1   printed,  or  which  may  be  prepared  by  direction  of  the  Secretary 
use  of  material   *^,   ,     '  .       ,  ...  1 1  •■  i 

for  circulation,    °f  *"^  Treasury  for  the  purpose  of  prmtmg,  any  obligation  or  other 

security  of  the  United  States,  who  uses  such  plate,   or  knowingly 

suffers  the  same  to  be  used  for  the  purpose  of  printing  any  such 

or  similar  obligation,  or  other  security,  or  any  part  thereof,  except 

as  may  be  printed  for  use  of  the  United  States  by  order  of  the 

proper  officer  thereof;    and  every  person  who  engraves,   or  causes 

or  procures  to  be  engraved,   or  assists  in  engraving,   any  plate   in 

the  likeness  of  any  plate  designed  for  the  printing  of  such  obligation 

or  other  security,  or  who  sells  any  such  plate,  or  who  brings  into 

the  United  States  from  any   foreign  place   any  such  plate,   except 

under    the    direction    of    the    Secretary    of    the    Treasury    or    other 

proper  officer,  or  with  any  other  intent,  in  either  case,  than  that  such 

plate  be  used  for  the  printing  of  the  obligations  or  other  securities 

of   the   United   States;     or   who    has   in   his    control,    custody,    or 

possession   any  metallic  plate  engraved  after  the  similitude  of  any 

plate  from  which   any  such  obligation  or  other   security  has   been 

printed,  with  intent  to  use  such  plate,  or  suffer  the  same  to  be  used 

in   forging  or  counterfeiting  any  such  obligation  or  other  security, 

or   any  part   thereof;     or  who   has   in   his   possession   or   custody. 


NATIONAL    BANK    ACT  127 

except  under  authority  from  the  Secretary  of  the  Treasury  or  other 
proper  officer,  any  obligation  or  other  security,  engraved  and 
printed  after  the  simiHtude  of  any  obHgation  or  other  security  issued 
under  the  authority  of  the  United  States,  with  intent  to  sell  or 
otherwise  use  the  same;  and  every  person  who  prints,  photographs, 
or  in  any  other  manner  makes  or  executes,  or  causes  to  be  printed, 
photographed,  made,  or  executed,  or  aids  in  printing,  photographing, 
making,  or  executing  any  engraving,  photograph,  print,  or  impression 
in  the  likeness  of  any  such  obligation  or  other  security,  or  any  part 
thereof,  or  who  sells  any  such  engraving,  photograph,  print,  or 
impression,  except  to  the  United  States,  or  who  brings  into  the 
United  States  from  any  foreign  place  any  such  engraving  photo- 
graph, print,  or  impression,  except  by  direction  of  some  proper 
officer  of  the  United  States,  or  who  has  or  retains  in  his  control 
or  possession,  after  a  distinctive  paper  has  been  adopted  by  the 
Secretary  of  the  Treasury  for  the  obligations  and  other  securities 
of  the  United  States,  any  similar  paper  adapted  to  the  making  of 
any  such  obligation  or  other  security,  except  under  the  authority  of 
the  Secretary  of  the  Treasury  or  some  other  proper  officer  of  the 
United  States,  shall  be  punished  by  a  fine  of  not  more  than  five 
thousand  dollars,  or  by  imprisonment  at  hard  labor  not  more  than 
fifteen  years,  or  by  both. 

172.  (Sec.   5431.)    Every  person  who,  with  intent  to  defraud.  Penalty  for 
passes,  utters,  publishes,  or  sells,  or  attempts  to  pass,  utter,  publish,  P<^^^^8    ^ 
or  sell,  or  brings  into  the  United  States  with  intent  to  pass,  publish,  •      i  •• 
utter,  or  sell,  or  keeps  in  possession  or  conceals,  with  like  intent,  any 

falsely  made,  forged,  counterfeited,  or  altered  obligation,  or  other 
security  of  the  United  States,  shall  be  punished  by  a  fine  of  not 
more  than  five  thousand  dollars  and  by  imprisonment  at  hard  labor 
not  more  than  fifteen  years. 

173.  (Sec.   5432.)   Every  person  who,  without  authority  from  Penalty  for 

the  United  States,  takes,  procures,  or  makes,  upon  lead,  foil,  wax,  '^^'"^     _ 

1    ,  iL  u  I  *    •  1  •  •  unauthorized 

plaster,  paper,  or  any  other  substance  or  material,   an  impression,  .  .         /. 

f    f  II  f  III         II  impressions  of 

stamp,  or  imprint  or,  from,  or  by  the  use  or,  any  bedplate,  bed-  (qqI^^ 

piece,  die,  roll,  plate,  seal,  type,  or  other  tool,  implement,  instru- 
ment, or  thing  used  or  fitted,  or  intended  to  be  used,  in  printing. 


128 N.    W.    HALSEY    &   CO. 

stamping,  or  impressing,  or  in  making  other  tools,  implements, 
instruments,  or  things,  to  be  used,  or  fitted  or  intended  to  be  used, 
in  printing,  stamping,  or  impressing  any  kind  or  description  of  obHga- 
tion  or  other  security  of  the  United  States,  now  authorized  or  hereafter 
to  be  authorized  by  the  United  States,  or  circulating  note  or  evidence 
of  debt  of  any  banking  association  under  the  laws  thereof,  shall  be 
punished  by  imprisonment  at  hard  labor  not  more  than  ten  years, 
or  by  a  fine  of  not  more  than  five  thousand  dollars,  or  both. 

Penalty)  for       1  74.    (Sec.  5433.)   Every  person  who,  with  intent  to  defraud, 
having  such  Jj^s  J^  J^is  possession,  keeping,  custody,  or  control,  without  authority 
'^  *  from  the  United  States,  any  imprint,  stamp,  or  impression,  taken  or 

made  upon  any  substance  or  material  whatsoever,  of  any  tool, 
implement,  instrument,  or  thing  used,  or  fitted,  or  intended  to  be  used 
for  any  of  the  purposes  mentioned  in  the  preceding  section;  or  who, 
with  intent  to  defraud,  sells,  gives,  or  delivers  any  such  imprint,  stamp, 
or  impression  to  any  other  person,  shall  be  punished  by  imprison- 
ment at  hard  labor  not  more  than  ten  years,  or  by  a  fine  of  not 
more  than  five  thousand  dollars. 

Penalty)  for  175.  (Sec.  5434.)  Every  person  who  buys,  sells,  exchanges, 
dealing  m  transfers,  receives,  or  delivers  any  false,  forged,  counterfeited,  or 
counterfeit  ^i^gj-ed  obligation  or  other  security  of  the  United  States,  or  circu- 
lating note  of  any  banking  association  organized  or  acting  under 
the  laws  thereof,  which  has  been  or  may  hereafter  be  issued  by 
virtue  of  any  act  of  Congress,  with  the  intent  that  the  same  be 
passed,  published,  or  used  as  true  and  genuine,  shall  be  imprisoned 
at  hard  labor  not  more  than  ten  years,  or  fined  not  more  than 
five  thousand  dollars,  or  both. 

Penalty  for        1  76.    (Sec.  5437.)    In  all  cases  where  the  charter  of  any  cor- 

issuing  poration   which  has  been  or  may  be  created  by   act  of  Congress 

circutation  ^^^   expired   or  may   hereafter   expire,   if   any   director,    officer,   or 

•  V-         agent  of  the  corporation,  or  any  trustee  thereof,  or  any  agent  of 

such  trustee,   or  any  person  having  in  his  possession  or  under  his 

control  the  property  of  the  corporation  for  the  purpose  of  paying 

or   redeeming  its  notes   and   obligations,   knowingly   issues,   reissues, 

or  utters  as  money,  or  in  any  other  way  knowingly  puts  in  circulation 

any  bill,   note,  check,   draft,   or  other  security  purporting  to  have 


NATIONAL    BANK   ACT  129 


been  made  by  any  such  corporation  whose  charter  has  expired, 
or  by  any  officer  thereof,  or  purporting  to  have  been  made  under 
authority  derived  therefrom,  or  if  any  person  knowingly  aids  in 
any  such  act,  he  shall  be  punished  by  a  line  of  not  more  than  ten 
thousand  dollars,  or  by  imprisonment  not  less  than  one  year  nor 
more  than  five  years,  or  by  both  such  fine  and  imprisonment.  But 
nothing  herein  shall  be  construed  to  make  it  unlawful  for  any 
person,  not  being  such  director,  officer,  or  agent  of  the  corporation, 
or  any  trustee  thereof,  or  any  agent  of  such  trustee,  or  any  person 
having  in  his  possession  or  under  his  control  the  property  of  the 
corporation  for  the  purpose  hereinbefore  set  forth,  who  has  received 
or  may  hereafter  receive  such  bill,  note,  check,  draft,  or  other 
security,  bona  fide  and  in  the  ordinary  transactions  of  business,  to 
utter  as  money  and  otherwise  circulate  the  same. 

1  n .  (Sec.  5208.)  It  shall  be  unlawful  for  any  officer,  clerk,  Fahe  certification 
or  agent  of  any  national  banking  association  to  certify  any  check  °f  checl^s. 
drawn  upon  the  association  unless  the  person  or  company  drawing 
the  check  has  on  deposit  with  the  association,  at  the  time  such 
check  is  certified,  an  amount  of  money  equal  to  the  amount  specified 
in  such  check.  Any  check  so  certified  by  duly  authorized  officers  shall 
be  a  good  and  valid  obligation  against  the  association;  but  the  act 
of  any  officer,  clerk,  or  agent  of  any  association,  in  violation  of 
this  section,  shall  subject  such  bank  to  the  liabilities  and  proceedings 
on  the  part  of  the  Comptroller  as  provided  for  in  section  fifty-two 
hundred  and  thirty-four. 

1 78.  Sec.   1 3  of  the  act  of  July   1 2,    1 882,  provides  that  any     Penalty)  for 
officer,   clerk,   or   agent   of   any   national   banking   association   who     /^"^  certification 
shall  willfully  violate  the   provisions   of   section   fifty-two   hundred     °'  ^"^^'i^' 
and  eight  of  the  Revised  Statutes  of  the  United  States,  or  who  shall 
resort  to  any  device,  or  receive  any  fictitious  obligations,  direct  or 
collateral,  in  order  to  evade  the  provisions  thereof,   or  who  shall 
certify  checks  before  the  amount  thereof  shall  have  been  regularly 
entered  to  the  credit  of  the  dealer  upon  the  books  of  the  banking 
association,    shall   be   deemed   guilty    of    a    misdeamor    an4   shall, 
on  conviction  thereof  in  any  circut  or  district  court  of  the  United 
States,  be  fined  not  more  than  five  thousand  dollars,  or  shall  be 


130  N.    W.    HALSEY   &   CO. 


imprisoned  not  more  ^an  five  years,  or  both,  in  the  discretion  of 
the    court. 

Penaltv  for  '  ^^*  (^EC.  5209.)  Every  president,  director,  cashier,  teller, 
official  clerk,  or  agent  of  any  association  who  embezzles,  abstracts,  or 
malfeasance,  willfully  misapplies  any  of  the  moneys,  funds,  or  credits  of  the 
association,  or  who,  without  authority  from  the  directors,  issues 
or  puts  in  circulation  any  of  the  notes  of  the  association;  or  who, 
without  such  authority,  issues  or  puts  forth  any  certificate  of  deposit, 
draws  any  order  or  bill  of  exchange,  makes  any  acceptance,  assigns 
any  note,  bond,  draft,  bill  of  exchange,  mortgage,  judgment,  or 
decree;  or  who  makes  any  false  entry  in  any  book,  report,  or 
statement  of  the  association,  with  intent,  in  either  case,  to  injure 
or  defraud  the  association  or  any  other  company,  body  politic  or 
corporate,  or  any  individual  person,  or  to  deceive  any  officer  of  the 
association  or  any  agent  appointed  to  examine  the  affairs  of  any 
such  association;  and  every  person  who  with  Hke  intent  aids  or 
abets  any  officer,  clerk,  or  agent  in  any  violation  of  this  section, 
shall  be  deemed  guilty  of  a  misdemeanor,  and  shall  be  imprisoned 
not  less  than  five  years  nor  more  than  ten. 

Jurisdiction  of        '®0-    (Sec.     629.)   The    circuit    courts    shall    have    original 

circuit  courts  jurisdiction    of     all     suits    brought    by     any    banking     association 

to  enjom  established    in    the    district    for    which    the    court    is    held,    under 

Comptroller,  jj^^  provisions  of  Title  "The  NATIONAL  Banks,"  to  enjoin  the 

Comptroller   of    the    Currency,    or    any    receiver    acting   under    his 

direction,  as  provided  by  said  Title. 

General        '^'*  ^ec.  4  of  the  act  of  July    12,    1882,  provides  that  the 

jurisdiction  of  jurisdiction  for  suits  hereafter  brought  by  or  against  any  association 

national-bank  established  under  any  law  providing  for  national  banking  associa- 

*^^"*   tions,    except    suits   between    them    and    the    United    States    or    its 

officers  and  agents,  shall  be  the  same  as,  and  not  other  than,  the 

jurisdiction    for    suits    by    or    against    banks    not    organized    under 

any   law   of    the    United    States   which    do   or   might   do    banking 

business   where    such   national   banking   associations   may   be   doing 

business  when  such  suits  may  be  begun.     And  all  laws  and  parts 

of   laws    of    the   United   States   inconsistent   with    this   proviso    be, 

and  the  same  are  hereby,  repealed.     Sec.  4  of  the  act  of  March 


NATIONAL    BANK   ACT  131 

3,  1887,  provides  that  all  national  banking  associations  established 

under  the  laws  of  the  United  States  shall,  for  the  purposes  of  all 

actions  by  or  against  them,  real,  personal,  or  mixed,  and  all  suits 

in   equity,    be   deemed   citizens   of   the   States   in   which   they    are 

respectively    located;    and    in    such    cases    the    circuit   and    district 

courts  shall  not  have  jurisdiction  other  than  such  as  they  would  have 

in    cases    between    individual    citizens    of    the    same    State.      The 

provisions  of  this  section  shall  not  be  held  to  afFect  the  jurisdiction 

of  the  courts   of  the   United   States   in   cases   commenced   by   the  , 

United  States  or  by  direction  of  any  officer  thereof,  of  cases  for 

winding  up  the  affairs  of  any  such  bank. 

182.  (Sec.  884.)   Every  certificate,  assignment,  and  conveyance  Sealed 
executed  by  the  Comptroller  of  the  Currency,  in  pursuance  of  law,  ^"""J^^^^^^  oj 
and  sealed  with  his  seal  of  office,  shall  be  received  in  evidence  in  competent 
all    places    and    courts;    and    all    copies    of   papers    in    his    office,  evidence. 
certified  by  him  and  authenticated  by  the  said  seal,   shall  in  all 

cases  be  evidence  equally  with  the  originals.  An  impression  of 
such  seal  directly  on  the  paper  shall  be  as  vaUd  as  if  made  on 
wax   or   wafer. 

183.  (Sec.  885.)   Copies  of  the  organization  certificate  of  any  Certified  cop]}  of 
national  banking  association,  duly  certified  by  the  Comptroller  of  ^'^Sf^/^^zation 

the   Currency    and   authenticated   by   his   seal   of   office,    shall    be      •  j 
evidence   in   all   courts   and   places   within   the   jurisdiction   of   the 
United   States   of   the   existence   of   the   association   and   of   every 
matter  which  could  be  proved  by  the  production  of  the  original 
certificate. 

184.  (Sec.    380.)   All    suits    and   proceedings    arising    out   of  Suits  against 
the    provisions    of    law    governing    national    banking    associations,  ^"''S"  otates 

in  which  the  United  States  or  any  of  its  officers  or  agents  shall  ''^''^"  '"'  ''^^"^' 

be   parties,    shall    be  conducted   by    the    district    attorneys   of    the 

several  districts  under  the  direction  and  supervision  of  the  Solicitor 
of    the    Treasury. 

185.  Sec.  31  of  the  Act  of  May  2,  1890,  provides  that  all  laws /nt/wn  Territory, 
relating  to  national  banking  associations  shall  have  the  same  force 

and  effect  in  Indian  Territory  as  elsewhere  in  the  United  States. 


132 N.    W.    HALSEY    6-   CO. 

Chapter  Nine. 

TRUST  COMPANIES.  ETC..  DISTRICT  OF  COLUMBIA. 

Provision  for  1 86.  The  act  of  October  1 .  1 890.  sec.  I .  provides  that 
organization,  corporations  may  be  formed  within  the  District  of  Columbia 
for  the  purposes  hereinafter  mentioned  in  the  following  manner: 
Any  time  hereafter  any  number  of  natural  persons,  citizens  of 
the  United  States,  not  less  than  twenty-five,  may  associate  them- 
selves together  to  form  a  company  for  the  purpose  of  carrying 
on  in  the  District  of  Columbia  any  one  of  the  three  classes  of 
business  herein  specified,  to  wit: 

First.  A  safe  deposit,  trust,  loan,  and  mortgage  business. 

Second.  A  title  insurance,  loan,  and  mortgage  business. 

Third.  A  security,  guaranty,  indemnity,  loan,  and  mortgage 
business:  Provided,  That  the  capital  stock  of  any  of  said  companies 
shall  not  be  less  than  one  million  of  dollars:  Provided  further.  That 
any  of  said  companies  may  also  do  a  storage  business  when  their 
capital  stock  amounts  to  the  sum  of  not  less  than  one  million  two 
hundred  thousand  dollars. 

Organization        187.    (Sec.    2.)   That   such   persons   shall,    under   their   hands 
certificate  of  and  seals,  execute,  before  some  officer  in  said  District  competent 
company,  j^  jj^j^g  j|^g  acknowledgment  of  deeds,   an  organization  certificate, 
which    shall    specifically    state — 
Title.       First.     The  name  of  the  corporation. 
Purposes.       Second.     The  purposes  for  which  it  is  formed. 

Period  of       Third.     The  term  for  which  it  is  to  exist,  which  shall  not  exceed 
existence,  t^g  term  of  fifty  years,  and  be  subject  to  alteration,  amendment,  or 
repeal  by  Congress  at  any  time. 

Officers.  Fourth.  The  number  of  its  directors,  and  the  names  and  residences 
of  the  officers  who  for  the  first  year  are  to  manage  the  affairs  of  the 
company. 

Capital  stock.       Fifth.     The  amount  of  the  capital  stock  and  its  subdivision  into 
shares. 


NATIONAL    BANK    ACT 133 

188.  (Sec.    3.)   That    this    certificate    shall    be    presented    to  Charter  obtained 
the    Commissioners    of    the    District,    who    shall    have    power    and  f^°^  district 
discretion  to  grant  or  to  refuse  to  said  persons  a  charter  of  incorpora-  commissjone  s. 
tion  upon  the  terms  set  forth  in  the  said  certificate  and  the  provisions 

of   this   act. 

189.  (Sec.  4.)   That  previous  to  the  presentation  of  the  said  Notice  of 
certificate    to    the   said    Commissioners    notice    of    the    intention    to  '"'enfion  to  apply 
apply    for   such   charter   shall   be   inserted   in   two   newspapers   of 

general  circulation  printed  in  the  District  of  Columbia  at  least 
four  times  a  week  for  three  weeks,  setting  forth  briefly  the  name 
of  the  proposed  company,  its  character  and  object,  the  names 
of  the  proposed  corporators,  and  the  intention  to  make  application 
for  a  charter  on  a  specified  day,  and  the  proof  of  such  publica- 
tion shall  be  presented  with  said  certificate  when  presentation 
thereof  is  made  to  said  Commissioners. 

190.  (Sec.   5.)   That  if  the  charter  be  granted  as   aforesaid  Charter  filed 

it,  together  with  the  certificate  of  the  Commissioners  granting  ^^""^^corder  of 
the  same  indorsed  thereon,  shall  be  filed  for  record  in  the  office  ?•  ,  •  . 
of  the  recorder  of  deeds  for  the  District  of  Columbia,  and  shall 
be  recorded  by  him.  On  the  filing  of  the  said  certificate  with  the 
said  recorder  of  deeds  as  herein  provided,  approved  as  aforesaid 
by  the  said  Commissioners,  the  persons  named  therein  and  their 
successors  shall  thereupon  and  thereby  be  and  become  a  body 
corporate  and  politic,  and  as  such  shall  be  vested  with  all  the 
powers  and  charged  with  all  the  liabilities  conferred  upon  and 
imposed  by  this  act  upon  companies  organized  under  the  provisions 
hereof:  Provided,  however.  That  no  corporation  created  and 
organized  under  the  provisions  hereof,  or  availing  itself  of  the  pro- 
visions hereof  as  provided  in  section  eleven,  shall  be  authorized  to 
transact  the  business  of  a  trust  company,  or  any  business  of  a  fiduciary 
character,  until  it  shall  have  filed  with  the  Comptroller  of  the  Currency 
a  copy  of  its  certificate  of  organization  and  charter  and  shall  have 
obtained  from  him  and  filed  the  same  for  record  with  the  said  recorder 
of  deeds  a  certificate  that  the  capital  stock  of  said  company  has  been 
paid  in  and  the  deposit  of  securities  made  with  said  Comptroller  in 
the  manner  and  to  the  extent  required  by  this  act. 


134 N.    W.    HALSEY    &   CO. 

Trust  companies       ^91.    (Sec.    6.)   That   all   companies   organized   hereunder,   or 
under  which  shall  under  the  provisions  hereof  become  entitled  to  transact 
Comptroller  s  ^^  business  of  a  trust  company,  shall  report  to  the  Comptroller  of 
^  *  the  Currency  in  the  manner  prescribed  by  sections  fifty-two  hundred 

and  eleven,  fifty-two  hundred  and  twelve,  and  fifty-two  hundred 
and  thirteen.  Revised  Statutes  of  the  United  States,  in  the  case 
of  national  banks,  and  all  acts  amendatory  thereof  or  supplementary 
thereto,  and  with  similar  provisions  for  compensating  examiners, 
and  shall  be  subject  to  like  penalties  for  failure  to  do  so.  The 
Comptroller  shall  have  and  exercise  the  same  visitorial  powers 
over  the  affairs  of  the  said  corporation  as  is  conferred  upon  him 
by  section  fifty-two  hundred  and  forty  of  the  Revised  Statutes 
of  the  United  States  in  the  case  of  national  banks.  He  shall  also 
have  power,  when  in  his  opinion  it  is  necessary,  to  take  possession 
of  any  such  company  for  the  reasons  and  in  the  manner  and  to  the 
same  extent  as  are  provided  in  the  laws  of  the  United  States 
with  respect  to  national  banks. 

Pollers  of  these       192.    (Sec.    7.)   That  all  companies  organized  under  this  act 
companies,  are   hereby   declared   to  be   corporations   possessed   of   the   powers 
and  functions  of  corporations  generally,  and  shall  have  power — 

Contracts.       First.     To  make  contracts. 

Suits.       Second.     To  sue  and  be  sued,  implead  and  be  impleaded,  in 
any  court  as  fully  as  natural  persons. 

Seal.       Third.     To  make  and  use  a  common  seal  and  alter  the  same  at 
pleasure. 

Loans.       Fourth,     To  loan  money. 

Special  powers.  Fifth.  When  organized  under  subdivision  one  of  the  first  section 
of  this  act  to  accept  and  execute  trusts  of  any  and  every  description 
which  may  be  committed  or  transferred  to  them,  and  to  accept  the 
office  and  perform  the  duties  of  a  receiver,  assignee,  executor,  adminis- 
trator, guardian  of  the  estates  of  minors,  with  the  consent  of  the  guar- 
dian of  the  person  of  such  minor,  and  committee  of  the  estates  of 
lunatics  and  idiots  whenever  any  trusteeship  or  any  such  office  or 
appointment  is  committed  or  transferred  to  them,  with  their  consent,  by 
any  person,  body  politic  or  corporate,  or  by  any  court  in  the  District 


NATIONAL    BANK   ACT 135 

of  Columbia,  and  all  such  companies  organized  under  the  first  sub- 
division of  section  one  of  this  act  are  further  authorized  to  accept 
deposits  of  money  for  the  purposes  designated  herein  upon  such 
terms  as  may  be  agreed  upon  from  time  to  time  with  depositors, 
and  to  act  as  agent  for  the  purpose  of  issuing  or  countersigning 
the  bonds  or  obligations  of  any  corporation,  association,  munici- 
pality, or  State,  or  other  public  authority,  and  to  receive  and 
manage  any  sinking  fund  on  any  such  terms  as  may  be  agreed 
upon,  and  shall  have  power  to  issue  its  debenture  bonds  upon 
deeds  of  trust  or  mortgages  of  real  estate  to  a  sum  not  exceeding 
the  face  value  of  said  deeds  of  trust  or  mortgages,  and  which 
shall  not  exceed  fifty  per  centum  of  the  fair  cash  value  of  the 
real  estate  covered  by  said  deeds  or  mortgages,  to  be  ascertained 
by  the  Comptroller  of  the  Currency.  But  no  debenture  bonds 
shall  be  issued  until  the  securities  on  which  the  same  are  based 
have  been  placed  in  the  actual  possession  of  the  trustee  named 
in  the  debenture  bonds,  who  shall  hold  said  securities  until  all 
of  said  bonds  are  paid;  and  when  organized  under  the  second 
subdivision  of  the  first  section  of  this  act  said  company  is  authorized 
to  insure  titles  to  real  estate  and  to  transact  generally  the  business 
mentioned  in  said  subdivision;  and  when  organized  under  the 
third  subdivision  of  section  one  of  this  act  said  company  is  hereby 
authorized,  in  addition  to  the  loan  and  mortgage  business  therein 
mentioned,  to  secure,  guaranty,  and  insure  individuals,  bodies 
politic,  associations,  and  corporations  against  loss  by  or  through 
trustees,  agents,  servants,  or  employees,  and  to  guaranty  the  faithful 
performance  of  contracts  and  of  obligations  of  whatever  kind 
entered  into  by  or  on  the  part  of  any  person  or  persons,  association, 
corporation  or  corporations,  and  against  loss  of  every  kind: 
Provided,  That  any  corporation  formed  under  the  provisions  of 
this  act  when  acting  as  trustee  shall  be  liable  to  account  for 
the  amounts  actually  earned  by  the  moneys  held  by  it  in  trust 
in  addition  to  the  principal  so  held;  but  such  corporation  may  be 
allowed  a  reasonable  compensation  for  services  performed  in 
the  care  of  the  trust  estate. 

193.    (Sec.  8.)      That  in  all  cases  in  which  application  shall    Competent  to 
be  made  to  any  court  in  the  District  of  Columbia,  or  wherever    °^^  *"  trustee,  etc. 


136  N.    W.    HALSEY    &   CO. 

it  becomes  necessary  or  proper  for  said  court  to  appoint  a  trustee, 
receiver,  administrator,  guardian  of  the  estate  of  a  minor,  or  com- 
mittee of  the  estate  of  a  lunatic,  it  shall  and  may  be  lawful  for  said 
court  (but  without  prejudice  to  any  preference  in  the  order  of 
any  such  appointments  required  by  existing  law)  to  appoint  any 
such  company  organized  under  the  first  subdivision  of  section  one 
of  this  act,  with  its  assent,  such  trustee,  receiver,  administrator, 
committee,  or  guardian,  with  the  consent  of  the  guardian  of  the 
person  of  such  minor:  Provided,  however.  That  no  court  or  judge 
who  is  an  owner  of  or  in  any  manner  financially  interested  in 
the  stock  or  business  of  such  corporation  shall  commit  by  order 
or  decree  to  any  such  corporation  any  trust  or  fiduciary  duty. 

Qualifications  of  194.  (Sec.  9.)  That  whenever  any  corporation  operating  under 
such  trustee,  etc.  this  act  shall  be  appointed  such  trustee,  executor,  administrator, 
receiver,  assignee,  guardian,  or  committee  as  aforesaid,  the  presi- 
dent, vice-president,  secretary,  or  treasurer  of  said  company  shall 
take  the  oath  or  affirmation  now  required  by  law  to  be  made  by 
any   trustee,    executor,    receiver,    assignee,    guardian,    or   committee. 

Security  for  195.  (Sec.  10.)  That  when  any  court  shall  appoint  the 
faithful  said  company  a  trustee,  receiver,  administrator,  or  such  guardian, 

perjormance  ^^  committee,  or  shall  order  the  deposit  of  money  or  other  valuables 
with  said  company,  or  where  any  individual  or  corporation  shall 
appoint  any  of  said  companies  a  trustee,  executor,  assignee,  or  such 
guardian,  the  capital  stock  of  said  company  subscribed  for  or  taken, 
and  all  property  owned  by  said  company,  together  with  the  liability 
of  the  stockholders  and  officers  as  herein  provided,  shall  be  taken 
and  considered  as  the  security  required  by  law  for  the  faithful 
performance  of  its  duties,  and  shall  be  absolutely  liable  in  case 
of  any  default  whatever. 

Privileges        ^^^-    (Sec.    11.)   That  any  safe  deposit  company,  trust  com- 

extended  to  pany,    surety    or    guaranty    company,    or    title-insurance    company 

existing  now   incorporated    and   operating   under    the   laws   of    the    United 

corporations,  states  or  of  the  District  of  Columbia,  or  any  of  the  States,  and 

now  doing  business  in  said  District,  may  avail  itself  of  the  provisions 

of  this  act  on  the  filing  in  the  office  of  the  recorder  of  deeds  of 

the  District  of  Columbia,  or  with  the  Comptroller  of  the  Currency, 


NATIONAL    BANK    ACT  137 

a  certificate  of  its  intention  to  do  so,  which  certificate  shall  specify 
which  one  of  the  three  classes  of  business  set  out  in  section  one 
it  will  carry  on,  and  shall  be  verified  by  the  oath  of  its  president 
to  the  effect  that  it  has  in  every  respect  complied  with  the  require- 
ments of  existing  law,  especially  with  the  provisions  of  this  act; 
that  its  capital  stock  is  paid  in  as  provided  in  section  twenty-one 
of  this  act  and  is  not  impaired,  and  thereafter  such  company  may 
exercise  all  powers  and  perform  all  duties  authorized  by  any 
one  of  the  subdivisions  of  section  one  of  this  act  in  addition  to  flie 
powers  now  lawfully  exercised  by  such  company. 

197.  (Sec.    12.)   That  any  company  operating  under  this  ^^^  ffenl  estate 
may  lease,  purchase,  hold,  and  convey  real  estate,  not  exceeding  in 

value  five  hundred  thousand  dollars,  and  such  in  addition  as  it 
may  acquire  in  satisfaction  of  debts  due  the  corporation,  under 
sales,  decrees,  judgments,  and  mortgages.  But  no  such  association 
shall  hold  the  possession  of  any  real  estate  under  foreclosure  of  mort- 
gage, or  the  title  and  possession  of  any  real  estate  purchased  to  secure 
any  debts  due  to  it,  for  a  longer  period  than  five  years. 

198.  (Sec.  13.)    That  the  charters  for  incorporations  named  J"  pg^.'^  J  ^f 
this  act  may  be  made  perpetual,   or  may  be  limited   in   time  by  corporations' 
their  provisions,   subject  to   the  approval   of  Congress.  existence. 


rovisions 


199.  (Sec.  14.)  That  the  capital  stock  of  every  such  company  p 
shall  be  at  least  one  million  dollars,  and  at  least  fifty  per  centum  relating  to 
thereof  must  have  been  paid  in,  in  cash  or  by  the  transfer  of  assets  capital  stock- 
as  hereinafter  provided  in  section  twenty-one  of  this  act,  before 
any  such  company  shall  be  entitled  to  transact  business  as  a 
corporation,  except  with  its  own  members,  and  before  any  company 
organized  hereunder  shall  be  entitled  to  transact  the  business  of 
a  trust  company,  or  to  become  and  act  as  an  administrator,  executor, 
guardian  of  the  estate  of  a  minor,  or  undertake  any  other  kindred 
fiduciary  duty,  it  shall  deposit,  either  in  money  or  in  bonds, 
mortgages,  deed  of  trust,  or  other  securities  equal  in  actual  value 
to  one-fourth  of  the  capital  stock  paid  in,  with  the  Comptroller 
of  the  Currency,  to  be  kept  by  him  upon  the  trust  and  for  the 
purposes  hereinafter  provided;  and  the  said  Comptroller  may 
from   time  to  time  require   an  additional   deposit  from   any   such 


138  N.    W.    HALSEY    &   CO. 

company,  to  be  held  upon  and  for  the  same  trust  and  purposes, 
not  exceeding,  however,  in  value  one-half  the  paid-in  capital  stock; 
and  the  said  Comptroller  shall  not  issue  to  any  corporation  the 
certificate  heretofore  provided  for  until  said  deposit  with  him  of 
securities  required  by  this  section.  Within  one  year  after  the 
organization  of  any  corporation  under  the  provisions  of  this  act, 
or  after  any  corporation  heretofore  existing  shall  have  availed 
itself  of  the  powers  and  rights  given  by  this  act  in  the  manner 
herein  provided  for,  its  entire  capital  stock  shall  have  been  paid  in. 

Enforcement  of  200.  (Sec.  15.)  That  the  capital  stock  of  every  such  com- 
'^  ,  pany  shall  be  divided  into  shares  of  one  hundred  dollars  each. 
It  shall  be  lawful  for  such  company  to  call  for  and  demand  from 
the  stockholders,  respectively,  all  sums  of  money  by  them  sub- 
scribed, at  such  time  and  in  such  proportions  as  its  board  of 
directors  shall  deem  proper,  within  the  time  specified  in  section 
fourteen,  and  it  may  enforce  payment  by  all  remedies  provided 
by  law;  and  if  any  stockholder  shall  refuse  or  neglect  to  pay  any 
installment  as  required  by  a  resolution  of  the  board  of  directors, 
after  thirty  days'  notice  of  the  same,  the  said  board  of  directors 
may  sell  at  public  auction,  to  the  highest  bidder,  so  many  shares 
of  said  stock  as  shall  pay  said  installment,  under  such  general 
regulations  as  may  be  adopted  in  the  by-laws  of  said  company, 
and  the  highest  bidder  shall  be  taken  to  be  the  person  who  offers  to 
purchase  the  least  number  of  shares  for  the  assessment  due. 

Annual  report  of  201.  (Sec.  16.)  That  every  such  company  shall  annually, 
Comptroller.  ^itJ^Jn  twenty  days  after  the  first  of  January  of  each  year,  make 
a  report  to  the  Comptroller  of  the  Currency,  which  shall  be 
published  in  a  newspaper  in  the  District,  which  shall  state  the 
amount  of  capital  and  of  the  proportion  actually  paid,  the  amount 
of  debts,  and  the  gross  earnings  for  the  year  ending  December 
thirty-first  then  next  previous,  together  with  their  expenses,  which 
report  shall  be  signed  by  the  president  and  a  majority  of  the 
directors  or  trustees,  and  shall  be  verified  by  the  oath  of  the 
president,  secretary,  and  at  least  three  of  the  directors  or  trustees. 

Tax  on  gross       202.    (Sec.    16.)   And  said  company  shall  pay  to  the  District 
of  Columbia,  in  lieu    of  personal  taxes  for  each  next  ensuing  year. 


NATIONAL    BANK   ACT 139 

one  and  a  half  per  centum  of  its  gross  earnings  for  the  preceding 
year,  shown  by  said  verified  statement,  which  amount  shall  be  payable 
to  the  collector  of  taxes  at  the  times  and  in  the  manner  that 
other  taxes  are  payable. 

203.  (Sec.    17.)   That  if  any  company  fails  to  comply  with  ^iabilit])  for 

the  provisons  of  the  preceding  section,  all  the  directors  or  trustees  '^     * 

of  such  company  shall  be  jointly  and  severally  liable  for  the  debts 

of  the  company  then  existing,  and  for  all  that  shall  be  contracted 

before    such    report   shall    be   made:    Provided,    That   in   case    of 

failure  of  the  company  in  any  year  to  comply  with  the  provisions 

of  section  sixteen  of  this  act,   and  any  of  the  directors  shall,   on 

or  before  January  fifteenth  of  such  year,   file  his  written   request 

for    such    compliance    with    the    secretary    of    the    company,    the 

Comptroller  of   the   Currency,   and   the   recorder  of  deeds  of  the 

District  of  Columbia,  such  director  shall  be  exempt  from  the  liability 

prescribed  in  this  section. 

204.  (Sec.    18.)   That   any   willful    false   swearing   in   regard   Perjury  and 
to  any  certificate  or  report  or  public  notice  required  by   the  pro-   'O^'cen];. 
visions  of  this  act  shall  be  perjury,  and  shall  be  punished  as  such 
according   to   the   laws  of   the   District   of   Columbia.      And   any 
misappropriation  of  any  of  the  money  of  any  corporation  or  com- 
pany  formed   under   this   act,   or   any   money,    funds,   or  property 

intrusted  to  it,  shall  be  held  to  be  larceny,  and  shall  be  punished 
as  such  under  the  laws  of  said  District 

205.  (Sec.    19.)   That  the  stock  of   such   company   shall   be    Transfer  of  stoc^. 
deemed  personal  estate,  and  shall  be  transferable  only  on  the  books 

of  such  company  in  such  manner  as  shall  be  prescribed  by  the 
by-laws  of  the  company;  but  no  shares  shall  be  transferable  until 
all  previous  calls  thereon  shall  have  been  fully  paid,  and  the  said 
stock  shall  not  be  taxable,  in  the  hands  of  individual  owners, 
the  tax  on  the  capital  stock,  gross  earnings  of  the  company  herein- 
before provided  being  in  lieu  of  other  personal  tax.  All  certificates 
of  the  stock  of  any  company  organized  under  this  act  shall  show 
upon  their  face  the  par  value  of  each  share  and  the  amount  paid 
thereon. 


140  N.    W.    HAL5EY    &   CO. 


Liabilit})  of  206.  (Sec.  20.)  That  all  stockholders  of  every  company 
stockholders,  incorporated  under  this  act,  or  availing  itself  of  its  provisions  under 
section  eleven,  shall  be  severally  and  individually  liable  to  the 
creditors  of  such  company  to  an  amount  equal  to  and  in  addition 
to  the  amount  of  stock  held  by  them,  respectively,  for  all  debts  and 
contracts  made  by  such  company. 

Mone^  207.  (Sec.  21.)  That  nothing  but  money  shall  be  considered 
payment  of  as  payment  of  any  part  of  the  capital  stock,  except  that  in  the 
capital  stoc^  ^.j^gg  ^f  ^^y  company  now  doing  business  in  the  District  of  Columbia 
in  any  of  the  classes  herein  provided  for,  or  under  any  act  of 
Congress  or  by  virtue  of  the  laws  of  any  of  the  States,  and  which 
company  has  actually  received  full  payment  in  money  of  at  least 
fifty  per  centum  of  the  capital  stock  required  by  this  act  and 
which  company  desires  to  obtain  a  charter  under  this  act,  all 
the  assets  or  property  may  be  received  and  considered  as  money, 
at  a  value  to  be  appraised  and  fixed  by  the  Comptroller  of  the 
Currency:  Provided,  That  all  such  assets  and  property  are  also 
transferred  to  and  are  thereafter  owned  by  the  company  organized 
under    this    act. 

Number  and  208.  (Sec.  22.)  That  the  stock,  property,  and  concerns  of  such 
election  of  company  shall  be  managed  by  not  less  than  nine  nor  more  than 
directors,  thirty  directors  or  trustees,  who  shall,  respectively,  be  stockholders 
and  at  least  one-half  residents  and  citizens  of  the  District  of 
Columbia,  and  shall,  except  the  first  year,  be  annually  elected 
by  the  stockholders  at  such  time  and  place  and  after  such  published 
notice  as  shall  be  determined  by  the  by-laws  of  the  company, 
and  said  directors  or  trustees  shall  hold  until  their  successors  are 
elected   and   qualified. 

Appointment  of  209.  (Sec.  23.)  That  there  shall  be  a  president  of  the 
officers,  company,  who  shall  be  a  director,  also  a  secretary  and  a  treasurer, 
all  of  whom  shall  be  chosen  by  the  directors  or  trustees:  Provided, 
That  only  one  of  the  above-named  offices  shall  be  held  by  the 
same  person  at  the  same  time.  Subordinate  officers  may  be 
appointed  by  the  directors  or  trustees,  and  all  such  officers  may 
be  required  to  give  such  security  for  the  faithful  performance 
of  the  duties  of  their  office  as  the  directors  or  trustees  may  require. 


NATIONAL    BANK    ACT Ml^ 

210.  (Sec.  24.)  That  the  directors  or  trustees  shall  have  By-Laws. 
power  to  make  such  by-laws  as  they  deem  proper  for  the  manage- 
ment or  disposal  of  the  stock  and  business  affairs  of  such  company, 
not  inconsistent  with  the  provisions  of  this  act,  and  prescribing 
the  duties  of  officers  and  servants  that  may  be  employed,  for  the 
appointment  of  all  officers,  and  for  carrying  on  all  kinds  of 
business  within  the  objects  and  purposes  of  such  company. 


211.    (Sec.    25.)   That   if    the    directors    or    trustees   of    any  Directors' liable 

for  pa})me\ 
unearned 
dividends. 


company    shall    declare    or   pay    any    dividend,    the    payment    of  /o''  pa})ment  of 
which  would  render  it  insolvent,  or  which  would  create  a  debt  ""^^''"^ 


against  such  company,  they  shall  be  jointly  and  severally  liable 
as  guarantors  for  all  of  the  debts  of  the  company  then  existing, 
and  for  all  that  shall  be  thereafter  contracted,  while  they  shall, 
respectively,  remain  in  office. 

212.  (Sec.  26.)   That  if  any  of  the  directors  or  trustees  shall  Directors' 
object  to  declaring  of  such  dividend  or  the  payment  of  the  same,    liability  may  be 
and  shall  at  any  time  before  the  time  fixed  for  the  payment  thereof  °^°'"^"* 

file  a  certificate  of  their  objection  in  writing  with  the  secretary 
of  the  company  and  with  the  recorder  of  deeds  of  the  District 
they  shall  be  exempt  from  liability  prescribed  in  the  preceding  section. 

213.  (Sec.  27.)   That  if  the  liabilities  of  any  company  shall   Responsibility  of 
at  any  time  exceed  the  amount  of  the  fair  cash  value  of  the  assets,    directors  for 

the  directors  or   trustees  of  such  company   assenting   thereto  shall    ^^'-^^^   "^  ' '  '^*' 
be  personally  and  individually  liable  for  such  excess  to  the  creditors 
of  the  company  after  the  additional  liabiHty  of  the  stockholders 
has  been  enforced.  jr 

214.  (Sec.  28.)   That  no  person  holding  stock  in  such  company  Trustee,  etc. 
as  executor,  administrator,  guardian,  or  trustee  shall  be  personally  not  liable  on 
subject  to   any  liability  as  stockholder  of  such  company,   but  the  ^'oc/f  assessment. 
estate    and    funds   in    the    hands   of   such    executor,    administrator, 

guardian,  or  trustee  shall  be  liable  in  like  manner  and  to  the 
same  extent  as  the  testator  or  intestate  or  the  ward  or  the  person 
interested  in  such  trust  fund  would  have  been  if  he  had  been 
living  and  competent  to  act  and  hold  the  stock  in  his  own  name. 


142 


N.    W.    HALSEY    &   CO. 


Increase  of        215.    (Sec.  29.)   That  any  corporation  which  may  be  formed 
capital,   under   this   chapter   may   increase   its   capital    stock   by    complying 
with  the  provisions  of  this  chapter  to  any  amount  which  may  be 
deemed  sufficient  and  proper  for  the  purposes  of  the  corporation. 

Certified  copy        216.    (Sec.  30.)   That  a  copy  of  any  certificate  of  incorpora- 

0/  incorporation   jjon  filed  in  pursuance  of  this  chapter,   certified   by   the   recorder 

^  of   deeds  to  be  a   true   copy   and   the  whole  of   such   certificate, 

evidence     ^^^^^   ^   received   in   all    courts   and   places   as   presumptive    legal 

evidence  of  the  facts  therein  stated. 

No  bond  or        217.    (Sec.    31.)   That  no   bond   or   other   collateral   security, 
other  security   except    as    hereinafter    stated,    shall    be    required    from    any    trust 
fj.    f  •       company    incorporated    under    this    act   for    or   in    respect   to    any 

trust,  nor  when  appointed  trustee,  guardian,  receiver,  executor, 
or  administrator,  with  or  without  the  will  annexed,  committee  of  the 
estate  of  a  lunatic  or  idiot,  or  other  fiduciary  appointment;  but 
the  capital  stock  subscribed  for  or  taken,  and  all  property  owned 
by  said  company  and  the  amount  for  which  said  stockholders  shall 
be  liable  in  excess  of  their  stock,  shall  be  taken  and  considered 
as  the  security  required  by  law  for  the  faithful  performance  of 
its  duties  and  shall  be  absolutely  liable  in  case  of  any  default 
whatever;  and  in  case  of  the  insolvency  or  dissolution  of  said 
company  the  debts  due  from  the  said  company  as  trustee,  guardian, 
receiver,  exectuor,  or  administrator,  committee  of  the  estate  of 
lunatics,  idiots,  or  any  other  fiduciary  appointment,  shall  have  a 
preference. 

District  supreme        218.    (Sec.    32.)   That   the  supreme  court  of  the   District  of 
court  has    Columbia,  or  any  justice  thereof,  shall  have  power  to  make  orders 


jurisdiction  of 
tust  companies. 


respecting  such  company  whenever  it  shall  have  been  appointed 
trustee,  guardian,  receiver,  executor,  or  administrator,  with  or  with- 
out the  will  annexed,  committee  of  the  estate  of  a  lunatic,  idiot, 
or  any  other  fiduciary,  and  require  the  said  company  to  render  all 
accounts  which  might  lawfully  be  made  or  required  by  any  court 
or  any  justice  thereof  if  such  trustee,  guardian,  receiver,  executor, 
administrator,  with  or  without  the  will  annexed,  committee  of  the 
estate  of  a  lunatic  or  idiot,  or  fiduciary  were  a  natural  person. 
And  said  court,  or  any  justice  thereof,  at  any  time,  on  application 


NATIONAL    BANK   ACT  143 

of  any  person  interested,  may  appoint  some  suitable  person  to 
examine  into  the  afiairs  and  standing  of  such  companies,  who 
shall  make  a  full  report  thereof  to  the  court,  and  said  court,  or 
any  justice  thereof,  may  at  any  time,  in  its  discretion,  require  of 
said  company  a  bond  with  sureties  or  other  securities  for  the  faithful 
performance  of  its  obligations,  and  such  sureties  or  other  security 
shall  be  liable  to  the  same  extent  and  in  the  same  manner  as  if 
given  or  pledged  by  a  natural  person. 

219.  (Sec.  33.)     That  no  corporation  or  company  organized  All  similar 
by  virtue  of  the  laws  of  any  of  the  States  of  this  Union  and  having  district 

its  principal  place  of  business  within  the  District  of  Columbia,  ^°J"PO''''|'o^ 
shall  carry  on,  in  the  District  of  Colimfibia,  any  of  the  kinds  of  ^^^ 
business  named  in  this  act  without  strict  compliance  in  all  particulars 
with  the  provisions  of  this  act  for  the  government  of  such  corpora- 
tions formed  under  it,  and  each  one  of  the  officers  of  the  corpora- 
tion or  company  so  offending  shall  be  punished  by  fine  not  exceeding 
one  thousand  dollars,  or  imprisonment  in  some  State's  prison  not 
exceeding  one  year,  or  by  both  fine  and  imprisonment,  in  the 
discretion  of  the  court.  This  section  shall  not  take  e^ect  till 
six  months  after  the  approval  of  this  acL 

220.  (Sec.  34.)   That  Congress  may  at  any  time  alter,  amend.  Provisions  for 
or  repeal  this  act,  but  any  such  amendment  or  repeal  shall  not,  nor  amendment. 
shall  the  dissolution  of  any  company  formed  under  this  act,  take 

away  or  impair  any  remedy  given  against  such  corporation,  its 
stockholders  or  officers,  for  any  liability  or  penalty  which  shall 
have  been  previously  incurred:  Provided,  That  the  courts  of  the 
District  of  Columbia  shall  not  have  power  to  appoint  any  trustee, 
trustees,  guardians,  receivers,  or  other  trustee  of  a  fund  or  property 
located  outside  of  the  District  of  Columbia,  or  belonging  to  a 
corporation  or  person  having  a  legal  residence  or  location  outside 
of   said   District. 


144 N.    W.    HALSEY    6-   CO. 

Chapter  Ten. 
SAVINGS  BANKS.  ETC..  DISTRICT  OF  COLUMBIA. 


INCORPORATION  OF  SAVINGS  BANKS  IN  THE 
DISTRICT   OF   COLUMBIA. 

'An  Act  to  Establish  a  Code  of  Law  for  the  District  of 
Columbia,"  Approved  March  Third,  Nineteen  Hun- 
dred AND  One,  as  Amended  by  the  Acts  Approved 
January  Thirty-first  and  June  Thirtieth,  Nineteen 
Hundred  and  Two. 

Chapters   XVIII.      Subchapter    IV.      Sec.    605. 


Provision  for  221.  "Any  three  or  more  persons  who  desire  to  form  a  company 
organuation.  f^j  jj^g  purpose  of  carrying  on  any  enterprise  or  business  which 
may  be  lawfully  conducted  by  an  individual,  excepting  banks  of 
circulation  or  discount  (corporations  to  buy,  sell,  or  deal  with  real 
property),  railroads,  and  such  other  enterprise  or  business  as  may 
be  otherwise  specially  provided  for  in  this  code,  may  make,  sign, 
and  acknowledge,  before  some  officer  competent  to  take  the 
acknowledgment  of  deeds,  and  file  in  the  office  of  the  recorder 
of  deeds  a  certificate  in  writing:  Provided,  That  nothing  herein 
contained  shall  be  held  to  authorize  the  organization  of  corpora- 
tions to  buy,  sell,  or  deal  in  real  estate,  except  corporations  to 
transact  the  business  ordinarily  carried  on  by  real-estate  agents  or 
brokers." 
Report  to  be  222.  (Sec.  713.)  All  savings  banks  or  savings  companies  or 
made  fo  institutions  organized  under  authority  of  any  act  of  Congress  to 
Comptroller.  ^Q  business  in  the  District  of  Columbia  shall  be,  and  are  hereby, 
required  to  make  to  the  Comptroller  of  the  Currency,  and  publish, 
all  the  reports  which  national  banking  associations  are  required  to 
make  and  publish  under  the  provisions  of  sections  fifty-two  hundred 
and  eleven,  fifty-two  hundred  and  twelve,  and  fifty-two  hundred 
and  thirteen  of  the  Revised  Statutes,  and  shall  be  subject  to  the 
same  penalties  for  failure  to  make  or  publish  such  reports  as  are 
therein  provided,  which  penalties  may  be  collected  by  suit  before 


NATIONAL    BANK    ACT  145 

the  supreme  court  of  the  District  of  Columbia. — ^Act  of  June 
30,   1902. 

223.  (Sec.  714.)   The  Comptroller  of  the  Currency,  in  addition  Comptroller 
to  the  powers  now  conferred  upon  him  by  law  for  the  examination  authorized  to 
of  national  banks,  is  hereby  further  authorized,  whenever  he  may  fi*^'"'"** 
deem  it  useful,  to  cause  examination  to  be  made  into  the  condition 

of  any  bank  in  the  District  of  Columbia  organized  under  act  of 
Congress.  The  Comptroller,  at  his  discretion,  may  report  to 
Congress  the  results  of  such  examination.  The  expenses  necessarily 
incurred  in  the  execution  of  this  section  shall  be  paid  out  of  any 
appropriation   made   by    Congress    for   special    bank    examinations. 

An  Act  to  amend  sections  seren  hundred  and  thirteen  and  seven  hundred  and 
fourteen  of  "An  Act  to  establish  a  code  of  law  for  the  District  of  Columbia," 
approved  March  third,  nineteen  hundred  and  one,  as  amended  by  the  Acts 
approved  January  thirty>first  and  June  thirtieth,  nineteen  hundred  and  two,  and  for 
other  purposes. 

224.  Be  it  enacted  b^  the  Senate  and  House  of  Representatives    Amendments 
of   the    United  States   of   America   in   Congress   assembled.    That    to  law. 
sections    seven    hundred    and    thirteen    and    seven    hundred    and 

fourteen  of  an  Act  entitled  "An  Act  to  establish  a  code  of  law 
for  the  District  of  Columbia,"  approved  March  third,  nineteen 
hundred  and  one,  as  amended  by  the  Acts  approved  January 
thirty-first  and  June  thirtieth,  nineteen  hundred  and  two,  are 
hereby  amended  so  as,  respectively,  to  read  as  follows: 

"Sec.  713.  All  savings  banks,  or  savings  companies,  or  trust 
companies,  or  other  banking  institutions,  organized  under  authority 
of  any  Act  of  Congress  to  do  business  in  the  District  of  Columbia, 
or  organized  by  virtue  of  the  laws  of  any  of  the  States  of  this 
Union,  and  having  an  office  or  banking  house  located  within  the 
District  of  Columbia  where  deposits  or  savings  are  received,  shall 
be,  and  are  hereby,  required  to  make  to  the  Comptroller  of  the 
Currency  and  to  publish  all  the  reports  which  national  banking 
associations  are  required  to  make  and  publish  under  the  provisions 
of  sections  fifty-two  hundred  and  eleven,  fifty-two  hundred  and 
twelve,  and  fifty-two  hundred  and  thirteen  of  the  Revised  Statutes 
of  the  United  States,   and  shall  be  subject  to  the  same  penalties 


146  N.    W.    HALSEY    &   CO. 


for  failure  to  make  such  reports  as  are  therein  provided,  which 
penalties  may  be  collected  by  suit  before  the  supreme  court  of 
the  District  of  Columbia.  And  the  Comptroller  shall  have  power, 
when  in  his  opinion  it  is  necessary,  to  take  possession  of  any  such 
bank  or  company,  for  the  reasons  and  in  the  manner  and  to  the 
same  extent  as  are  provided  in  the  laws  of  the  United  States  with 
respect  to  national  banks:  Provided,  horvever.  That  banking 
institutions  having  offices  or  banking  houses  in  foreign  countries 
as  well  as  in  the  District  of  Columbia  shall  only  be  required  to  make 
and  publish  the  reports  provided  for  in  this  section  semi-annually: 
And  provided  further.  That  all  publications  authorized  or  required 
by  said  section  fifty-two  hundred  and  eleven  of  the  Revised 
Statutes,  and  all  other  publications  authorized  or  required  by  existing 
law  to  be  made  in  the  District  of  Columbia,  shall  be  printed  in 
two  or  more  daily  newspapers  of  general  circulation,  published  in 
the  City  of  Washington,  one  of  which  shall  be  a  morning  newspaper. 

"Sec.  714.  The  Comptroller  of  the  Currency,  in  addition 
to  the  powers  now  conferred  upon  him  by  law  for  the  examination 
of  national  banks,  is  hereby  further  authorized,  whenever  he  may 
deem  it  useful,  to  cause  examination  to  be  made  into  the  condition 
of  any  bank  mentioned  in  the  preceding  section.  The  expense  of 
such  examination  shall  be  paid  in  the  manner  provided  by  section 
fifty-two  hundred  and  forty  of  the  Revised  Statutes  of  the  United 
States  relating  to  the  examination  of  national  banks." 

Approved,  June  25,   1906. 

Chapter  Eleven. 

GOVERNMENT    DEPOSITARIES. 

Designation  and  225.  (Sec.  5153,  as  amended  by  the  act  of  March  4,  1907.) 
duties  of  public  p^\  national  banking  associations,  designated  for  that  purpose  by 
eposi  a  les.  ^^  Secretary  of  the  Treasury,  shall  be  depositaries  of  public  money, 
under  such  regulations  as  may  be  prescribed  by  the  Secretary; 
and  they  may  also  be  employed  as  financial  agents  of  the  Govern- 
ment; and  they  shall  perform  all  such  reasonable  duties,  as 
depositaries  of  public  money  and  financial  agents  of  the  Government, 


NATIONAL    BANK    ACT  147 


as  may  be  required  of  them.  The  Secretary  of  the  Treasury 
shall  require  the  associations  thus  designated  to  gire  satisfactory 
security,  by  the  deposit  of  United  States  bonds  and  otherwise,  for 
the  safe-keeping  and  prompt  payment  of  the  public  money  deposited 
with  them,  and  for  the  faithful  performance  of  their  duties  as 
financial  agents  of  the  Government:  Provided,  That  the  Secretary 
shall,  on  or  before  the  first  of  January  of  each  year,  make  a 
public  statement  of  the  securities  required  during  that  year  for  such 
deposits.  And  every  association  so  designated  as  receiver  or 
depositary  of  the  public  money  shall  take  and  receive  at  par  all 
of  the  national  currency  bills,  by  whatever  association  issued, 
which  have  been  paid  into  the  Government  for  internal  revenue, 
or  for  loans  or  stocks:  Provided,  That  the  Secretary  of  the  Treasury 
shall  distribute  the  deposits  herein  provided  for,  as  far  as  practicable, 
equitably  between  the  different  States  and  sections. 

226.  (Sec.   3620.)   It  shall  be  the  duty  of  every  disbursing  ^5^°"'  ^"f 
officer  having  any  public  money  intrusted  to  him  for  disbursement  ^  i  ;• 

to  deposit  the  same  with  the  Treasurer  or  some  one  of  the  assistant 
treasurers  of  the  United  States,  and  to  draw  from  the  same  only 
as  it  may  be  required  for  payments  to  be  made  by  him  in  pursuance 
of  law;  and  draw  from  the  same  only  in  favor  of  the  persons  to 
whom  payment  is  made,  and  all  transfers  from  the  Treasurer  of 
the  United  States  to  a  disbursing  officer  shall  be  by  draft  or  warrant 
on  the  Treasurer  or  assistant  treasurer  of  the  United  States.  In 
places,  however,  where  there  is  no  Treasurer  or  assistant  treasurer, 
the  Secretary  of  the  Treasury  may,  when  he  deems  it  essential  to 
the  public  interest,  specially  authorize  in  writing  the  deposit  of 
such  public  money  in  any  other  public  depositary,  or,  in  writing, 
authorize  the  same  to  be  kept  in  any  other  manner  and  under  such 
rules  and  regulations  as  he  may  deem  most  safe  and  effectual  to 
facilitate  the  payments  to  public  creditors. 

227.  (Sec.    3847.)   Any    postmaster,    having    public    money  ^^°^^^j°^fo^ 
belonging  to  the  Government,   at  an  office  within  a  county  where  ^J!i^:„ 

there  are  no  designated  depositaries,  treasurers  of  mints,  or  Treasurer  postmasters. 
or  assistant  treasurers  of  the  United  States  may  deposit  the  same,  at 
his  own  risk  and  in  his  official  capacity,  in  any  national  bank  in  the 


148  N.    W.    HALSEY    &   CO. 

town,  city,  or  county  where  the  said  postmaster  resides;  but  no 
authority  or  permission  is  or  shall  be  given  for  the  demand  or 
receipt  by  the  postmaster,  or  any  other  person,  of  interest,  directly 
or  indirectly,  on  any  deposit  made  as  herein  described;  and  every 
postmaster  who  makes  any  such  deposit  shall  report  quarterly  to 
the  Postmaster-General  the  name  of  the  bank  where  such  deposits 
have  been  made,  and  also  state  the  amount  which  may  stand 
at  the  time  to  his  credit. 

Penaltv  for  228.  (Sec.  4046.)  Every  postmaster,  assistant,  clerk,  or  other 
misapplication  of  person  employed  in  or  connected  with  the  business  or  operations 
mone^-order  ^f  ^ny  money-order  office  who  converts  to  his  own  use,  in  any  way 
Jun  s.  ^i^j^jgygr^  Qj  loans,  or  deposits  in  any  bank,  except  as  authorized 
by  this  Title,  or  exchanges  for  other  funds,  any  portion  of  the 
money-order  funds,  shall  be  deemed  guilty  of  embezzlement,  and 
any  such  person,  as  well  as  every  other  person  advising  or  partici- 
pating therein,  shall,  for  every  such  offense,  be  imprisoned  for 
not  less  than  six  months  nor  more  than  ten  years,  and  be  fined  in  a  sum 
equal  to  the  amount  embezzled;  and  any  failure  to  pay  over  or 
produce  any  money-order  funds  intrusted  to  such  person  shall  be 
taken  to  be  prima  facie  evidence  of  embezzlement;  and  upon  the 
trial  of  any  indictment  against  any  person  for  such  embezzlement 
it  shall  be  prima  facie  evidence  of  a  balance  against  him  to  produce 
a  transcript  from  the  money-order  account  books  of  the  Sixth 
Auditor.  But  nothing  herein  contained  shall  be  construed  to 
prohibit  any  postmaster  depositing,  under  the  direction  of  the  Post- 
master-General, in  a  national  bank  designated  by  the  Secretary  of 
the  Treasury  for  that  purpose,  to  his  own  credit  as  postmaster, 
any  money-order  or  other  funds  in  his  charge,  nor  prevent  his 
negotiating  drafts  or  other  evidences  of  debt  through  such  bank, 
or  through  United  States  disbursing  officer,  or  otherwise,  when 
instructed  or  required  to  do  so  by  the  Postmaster-General  for  the 
purpose  of  remitting  surplus  money-order  funds  from  one  post- 
office  to  another,  to  be  used  in  pa3Tnent  of  money-orders.  Dis- 
bursing officers  of  the  United  States  shall  issue,  under  regulations 
to  be  prescribed  by  the  Secretary  of  the  Treasury,  duplicates  of 
lost  checks  drawn  by  them  in  favor  of  any  postmaster  on  account 


NATIONAL    BANK    ACT  149 

of  money-order  or  other  public  funds  received  by  them  from 
some  other  postmaster. 

229.  (Sec.  5488.)   Every    disbursing    officer    of    the    United  Penalt}f  for 
States   who   deposits   any   public   money   intrusted   to   him   in    any  tinauihorized 
place  or  in  any  manner,  except  as  authorized  by  law,  or  converts     ^P^^'    °'  "" 
to  his  own  use  in  any  way  whatever,   or  loans  with  or  without 

interest,  or  for  any  purpose  not  prescribed  by  law  withdraws  from 
the  Treasurer  or  any  assistant  treasurer,  or  any  authorized  depos- 
itary, or  for  any  purpose  not  prescribed  by  law  transfers  or  applies 
any  portion  of  the  public  money  intrusted  to  him,  is,  in  every  such 
act,  deemed  guilty  of  an  embezzlement  of  the  money  so  deposited, 
converted,  loaned,  withdrawn,  transferred,  or  appHed;  and  shall 
be  punished  by  imprisonment  with  hard  labor  for  a  term  not  less 
than  one  year  nor  more  than  ten  years,  or  by  a  fine  of  not  more 
than  the  amount  embezzled  or  less  than  one  thousand  dollars,  or 
by  both  such  fine  and  imprisonment. 

230.  (Sec.  5497.)    Every  banker,  broker,  or  other  person  not  Penalty  jot 
an  authorized  depositary  of  public  moneys,  who  knowingly  receives  unauthorized 
from  any  disbursing  officer,  or  collector  of  internal  revenue,  or  other  '"^ccipf  or  use  of 
agent  of  the  United  States,  any  public  money  on  deposit,  or  by  '^  ^' 
way  of  loan  or  accommodation,  with  or  without  interest,  or  other- 
wise than  in  payment  of  a  debt  against  the  United  States,  or  who 

uses,  transfers,  converts,  appropriates,  or  applies  any  portion  of  the 
public  money  for  any  purpose  not  prescribed  by  law,  and  every 
president,  cashier,  teller,  director,  or  other  officer  of  any  bank  or 
banking  association,  who  violates  any  of  the  provisions  of  this 
section,  is  guilty  of  an  act  of  embezzlement  of  the  public  money 
so  deposited,  loaned,  transferred,  used,  converted,  appropriated,  or 
applied,  and  shall  be  punished  as  prescribed  in  section  fifty-four 
hundred  and  eighty-eight. 


150  N.    W.    HALSEY    &   CO. 


Chapter  Twelve. 

MISCELLANEOUS. 

Legal  tender  231.  The  following  statement  concerning  the  legal-tender  prop- 
and  laivful  erties  of  money  of  the  United  States  is  based  upon  United  States 
mone\).  Revised  Statutes,  sections  3585,  3586,  3587,  3588,  3589,  and 
3590,  and  the  acts  amendatory  thereof  and  additional  thereto: 

Gold  coin,  standard  silver  dollars,  subsidiary  silver,  minor  coins, 
United  States  notes,  and  Treasury  notes  of  1 890  have  the  legal- 
tender  quality  as  follow^s:  Gold  coin  is  legal  tender  for  its  nominal 
value  vs^hen  not  below  the  limit  of  tolerance  in  weight;  when  below 
that  limit  it  is  legal  tender  in  proportion  to  its  weight;  standard 
silver  dollars  and  Treasury  notes  of  1890  are  legal  tender  for  all 
debts,  public  and  private,  except  where  otherwise  expressly  stipu- 
lated in  the  contract;  subsidiary  silver  is  legal  tender  to  the  extent 
of  $  1 0,  minor  coins  to  the  extent  of  25  cents,  and  United  States 
notes  for  all  debts,  public  and  private,  except  duties  on  imports 
and  interest  on  the  public  debt.  Gold  certificates,  silver  certificates, 
and  national-bank  notes  are  nonlegal-tender  money.  Both  kinds 
of  certificates,  however,  are  receivable  for  all  public  dues,  and 
national-bank  notes  are  receivable  for  all  public  dues  except  duties 
on  imports,  and  may  be  paid  out  for  all  public  dues,  except 
interest  on  the  public  debt. 

The  term  "lawful  money"  is  understood  to  apply  to  every  form 
of  money  which  is  endowed  by  law  with  the  legal-tender  quality. 
(See  Opinions  of  Attorneys-General,  vol.    17,  p.    123.) 


Currency  Act 

of   March    14,    1900 


An  Act  to  Define  and  Fix  the  Standard  of  Value,  to 
Maintain  the  Parity  of  All  Forms  of  Money  Issued 
OR  Coined  by  the  United  States,  to  Refund  the 
Public  Debt,  and  for  Other  Purposes. 

Be  it  enacted  by  the  Senate  and  House  of  Representatives  of  the   Dollar  standard 
United  States  of  America  in  Congress  assembled.  That  the  dollar    """  , 

r  r  11  1  f  1  1        .  ^  of  Vfl/UC. 

consisting  or  twenty-hve  and  eight-tenths  grains  or  gold  nine-tenths 
fine,  as  established  by  section  thirty-five  hundred  and  eleven  of  the 
Revised  Statutes  of  the  United  States,  shall  be  the  standard  unit 
of  value,  and  all  forms  of  money  issued  or  coined  by  the  United 
States  shall  be  maintained  at  a  parity  of  value  with  this  standard, 
and  it  shall  be  the  duty  of  the  Secretary  of  the  Treasury  to  maintain 
such  parity. 

Sec.  2.  That  United  States  notes,   and  Treasury  notes  issued   Redemption  of 
under   the   Act   of  July   fourteenth,   eighteen   hundred    and   ninety,    J^'  ^'  "°'"  ^"^ 
when  presented  to  the  Treasury  for  redemption,  shall  be  redeemed 
in  gold  coin  of  the  standard  fixed  in  the  first  section  of  this  Act, 
and  in  order  to  secure  the  prompt  and  certain  redemption  of  such 
notes  as  herein  provided  it  shall  be  the  duty  of  the  Secretary  of 
the  Treasury  to  set  apart  in  the  Treasury  a  reserve  fund  of  one 
hundred  and  fifty  million  dollars  in  gold  coin  and  bullion,  which 
fund  shall  be  used  for  such  redemption  purposes  only,  and  when- 
ever and   as  often   as  any  of  said   notes  shall  be   redeemed   from 
said  fund  it  shall  be  the  duty  of  the  Secretary  of  the  Treasury 
to  use  said  notes  so  redeemed  to  restore  and  maintain  such  reserve    Maintenance  of 
fund  in  the  manner  following,   to  wit:      First,  by  exchanging  the    reserve. 
notes  so  redeemed  for  any  gold  coin  in  the  general   fund  of  the 
Treasury;     second,    by    accepting    deposits    of    gold    coin    at    the 
Treasury  or  at  any  subtreasury  in  exchange  for  the  United  States 
notes  so  redeemed;    third,  by  procuring  gold  coin  by  the  use  of  said 


152 


N.    W.    HALSEY    &   CO. 


Issuing  of  bonds 

to  maintain 

reserve. 


notes,  in  accordance  with  the  provisions  of  section  thirty-seven 
hundred  of  the  Revised  Statutes  of  the  United  States.  If  the 
Secretary  of  the  Treasury  is  unable  to  restore  and  maintain  the 
gold  coin  in  the  reserve  fund  by  the  foregoing  methods,  and  the 
amount  of  such  gold  coin  and  bullion  in  said  fund  shall  at  any 
time  fall  below  one  hundred  million  dollars,  then  it  shall  be  his 
duty  to  restore  the  same  to  the  maximum  sum  of  one  hundred  and 
fifty  million  dollars  by  borrowing  money  on  the  credit  of  the  United 
States,  and  for  the  debt  thus  incurred  to  issue  and  sell 
coupon  or  registered  bonds  of  the  United  States,  in  such 
form  as  he  may  prescribe,  in  denominations  of  fifty  dollars 
or  any  multiple  thereof,  bearing  interest  at  the  rate  of  not 
exceeding  three  per  centum  per  annum,  payable  quarterly, 
such  bonds  to  be  payable  at  the  pleasure  of  the  United 
States  after  one  year  from  the  date  of  their  issue,  and  to  be 
payable,  principal  and  interest,  in  gold  coin  of  the  present 
standard  value,  and  to  be  exempt  from  the  payment  of  all 
taxes  or  duties  of  the  United  States,  as  well  as  from  taxa- 
tion in  any  form  by  or  under  State,  municipal,  or  local 
authority;  and  the  gold  coin  received  from  the  sale  of  said  bonds 
shall  first  be  covered  into  the  general  fund  of  the  Treasury  and  then 
exchanged,  in  the  manner  hereinbefore  provided,  for  an  equal  amount 
of  the  notes  redeemed  and  held  for  exchange,  and  the  Secretary  of  the 
Treasury  may,  in  his  discretion,  use  said  notes  in  exchange  for  gold, 
or  to  purchase  or  redeem  any  bonds  of  the  United  States,  or 
for  any  other  lawful  purpose  the  public  interests  may  require,  except 
that  they  shall  not  be  used  to  meet  deficiencies  in  the  current 
revenues.  That  United  States  notes  when  redeemed  in  accordance 
with  the  provisions  of  this  section  shall  be  reissued,  but  shall  be 
held  in  the  reserve  fund  until  exchanged  for  gold,  as  herein  pro- 
vided; and  the  gold  coin  and  bullion  in  the  reserve  fund,  together 
with  the  redeemed  notes  held  for  use  as  provided  in  this  section, 
shall  at  no  time  exceed  the  maximum  sum  of  one  hundred  and 
fifty  million  dollars. 

Legal  tender.  Sec.  3.  That  nothing  contained  in  this  Act  shall  be  construed 
to  affect  the  legal-tender  quality  as  now  provided  by  law  of  the 
silver  dollar,  or  of  any  other  money  coined  or  issued  by  the 
United  States. 


Notes 


re-issuec 


CURRENCY    ACT    OF    MARCH    14.    1900  153 


Sec.  4.  That  there  be  established  in  the  Treasury  Department,  DivisioTJs  of 
as  a  part  of   the  office   of   the   Treasurer   of   the   United   States,  '""^  ^"^ 
divisions  to  be  designated  and  known  as  the  division  of  issue  and  ^ 

the  division  of  redemption,  to  which  shall  be  assigned,  respectively, 
under  such  regulations  as  the  Secretary  of  the  Treasury  may 
approve,  all  records  and  accounts  relating  to  the  issue  and  redemp- 
tion of  United  States  notes,  gold  certificates,  silver  certificates,  and 
currency  certificates.  There  shall  be  transferred  from  the  accounts 
of  the  general  fund  of  the  Treasury  of  the  United  States,  and 
taken  up  on  the  books  of  said  divisions,  respectively,  accounts 
relating  to  the  reserve  fund  for  the  redemption  of  United  States  Reserves  are 
notes  and  Treasury  notes,  the  gold  coin  held  against  outstanding  ""^'  fuTUts. 
gold  certificates,  the  United  States  notes  held  against  outstanding 
currency  certificates,  and  the  silver  dollars  held  against  outstanding 
silver  certificates,  and  each  of  the  funds  represented  by  these 
accounts  shall  be  used  for  the  redemption  of  the  notes  and  certifi- 
cates for  which  they  are  respectively  pledged,  and  shall  be  used 
for  no  other  purpose,  the  same  being  held  as  trust  funds. 

Sec.  5.  That   it  shall   be   the   duty   of   the   Secretary   of   the  Coinage  of 
Treasury,  as  fast  as  standard  silver  dollars  are  coined  under  the  *"^^''  doUars, 
provisions  of  the  Acts  of  July   fourteenth,   eighteen  hundred   and 
ninety,  and  June  thirteenth,  eighteen  hundred  and  ninety-eight,  from 
bullion    purchased    under    the    Act    of    July    fourteenth,    eighteen 
hundred   and    ninety,    to    retire    and   cancel    an   equal    amount    of  Retirement  of 
Treasury    notes    whenever    received    into    the    Treasury,    either    by  f^^osury  notes. 
exchange  in  accordance  with  the  provisions  of  this  Act  or  in  the 
ordinary  course  of  business,  and  upon  the  cancellation  of  Treasury 
notes  silver  certificates  shall  be  issued  against  the  silver  dollars  so 
coined. 

Sec.  6.  (As  amended  by  act  of  March  4,  1907.)  That  the  Gold  certificates. 
Secretary  of  the  Treasury  is  hereby  authorized  and  directed  to 
receive  deposits  of  gold  coin  with  the  Treasurer  or  any  assistant 
treasurer  of  the  United  States  in  sums  of  not  less  than  twenty 
dollars,  and  to  issue  gold  certificates  therefor  in  denominations  of 
not  less  than  ten  dollars,  and  the  coin  so  deposited  shall  be  retained 
in  the  Treasury  and  held  for  the  payment  of  such  certificates  on 
demand,  and  used  for  no  other  purpose.     Such  certificates  shall  be 


U  N  i  V  E  R 


154  N.    W.    HALSEY    &   CO. 

receivable  for  customs,  taxes,  and  all  public  dues,  and  when  so 
received  may  be  reissued,  and  when  held  by  any  national  banking 
association  may  be  counted  as  a  part  of  its  lawful  reserve:  Pro- 
vided, That  whenever  and  so  long  as  the  gold  coin  and  bullion  held 
in  the  reserve  fund  in  the  Treasury  for  the  redemption  of  United 
States  notes  and  Treasury  notes  shall  fall  and  remain  below  one 
When  authority  hundred  million  dollars  the  authority  to  issue  certificates  as  herein 
to  issue  is  provided  shall  be  suspended:  And  provided  further,  That  when- 
suspended.  ^^^^  ^^^  ^^  ^^^^  ^^  ^^  aggregate  amount  of  United  States  notes 
and  silver  certificates  in  the  general  fund  of  the  Treasury  shall 
exceed  sixty  million  dollars  the  Secretary  of  the  Treasury  may,  in 
his  discretion,  suspend  the  issue  of  the  certificates  herein  provided 
for:  And  provided  further.  That  of  the  amount  of  such  out- 
standing certificates  one-fourth  at  least  shall  be  in  denominations 
of  fifty  dollars  or  less:  And  provided  further.  That  the  Secretary 
of  the  Treasury  may,  in  his  discretion,  issue  such  certificates  in 
denominations  of  ten  thousand  dollars,  payable  to  order.  And 
section  fifty-one  hundred  and  ninety-three  of  the  Revised  Statutes 
of  the  United  States  is  hereby  repealed.  The  act  of  March  4, 
1907  (sec.  2),  provides  that  whenever  and  so  long  as  the  out- 
standing silver  certificates  of  the  denominations  of  one  dollar,  two 
dollars,  and  five  dollars,  issued  under  the  provisions  of  section 
seven  of  an  Act  entitled  "An  Act  to  define  and  fix  the  standard 
of  value,  to  maintain  the  parity  of  all  forms  of  money  issued  or 
coined  by  the  United  States,  to  refund  the  public  debt,  and  for 
other  purposes,"  approved  March  fourteenth,  nineteen  hundred, 
shall  be,  in  the  opinion  of  the  Secretary  of  the  Treasury,  insufficient 
to  meet  the  public  demand  therefor,  he  is  hereby  authorized  to  issue 
United  States  notes  of  the  denominations  of  one  dollar,  two  dollars, 
and  five  dollars,  and  upon  the  issue  of  United  States  notes  of  such 
denominations  an  equal  amount  of  United  States  notes  of  higher 
denominations  shall  be  retired  and  canceled:  Provided,  however. 
Amount  of  That  the  aggregate  amount  of  United  States  notes  at  any  time 
U.  S.  notes  outstanding  shall  remain  as  at  present  fixed  by  law:  And  provided 
outstanding  further.  That  nothing  in  this  Act  shall  be  construed  as  affecting 
fixed  by  laTV,  ^^  ^.jgj^^  ^£  ^^^  national  bank  to  issue  one-third  in  amount  of  its 
circulating  notes  of  the  denomination  of  five  dollars,  as  now  pro- 
vided by  law. 


CURRENCY    ACT    OF    MARCH    14.    1900  155 


Sec.  7.  That  hereafter  silver  certificates  shall  be  issued  only  of  5i7ver  certificates. 
denominations  of  ten  dollars  and  under,  except  that  not  exceeding 
in  the  aggregate  ten  per  centum  of  the  total  volume  of  said  certifi- 
cates, in  the  discretion  of  the  Secretary  of  the  Treasury,  may  be 
issued  in  denominations  of  twenty  dollars,  fifty  dollars,  and  one 
hundred  dollars;  and  silver  certificates  of  higher  denomination 
than  ten  dollars,  except  as  herein  provided,  shall,  whenever  received 
at  the  Treasury  or  redeemed,  be  retired  and  canceled,  and  certifi- 
cates of  denominations  of  ten  dollars  or  less  shall  be  substituted  there- 
for, and  after  such  substitution,  in  whole  or  in  part,  a  like  volume  of 
United  States  notes  of  less  denomination  than  ten  dollars  shall 
from  time  to  time  be  retired  and  canceled,  and  notes  of  denomina- 
tions of  ten  dollars  and  upward  shall  be  reissued  in  substitution 
therefor,  with  like  qualities  and  restrictions  as  those  retired  and 
canceled. 

Sec.  8.  That  the  Secretary  of  the  Treasury  is  hereby  author-  Subsidiar\f  coin. 
ized  to  use,  at  his  discretion,  any  silver  bullion  in  the  Treasury  of 
the  United  States  purchased  under  the  Act  of  July  fourteenth, 
eighteen  hundred  and  ninety,  for  coinage  into  such  denominations 
of  subsidiary  silver  coin  as  may  be  necessary  to  meet  the  public 
requirements  for  such  coin:  Provided,  That  the  amount  of  sub- 
sidiary silver  coin  outstanding  shall  not  at  any  time  exceed  in  the 
aggregate  one  hundred  millions  of  dollars.  Whenever  any  silver 
bullion  purchased  under  the  Act  of  July  fourteenth,  eighteen 
hundred  and  ninety,  shall  be  used  in  the  coinage  of  subsidiary 
silver  coin,  an  amount  of  Treasury  notes  issued  under  said  Act 
equal  to  the  cost  of  the  bullion  contained  in  such  coin  shall  be 
cancelled  and  not  reissued. 

Sec.  9.  That  the  Secretary  of  the  Treasury  is  hereby  authorized  Worn  and 
and  directed  to  cause  all  worn  and  uncurrent  subsidiary  silver  coin  uncurrent 
of  the  United  States  now  in  the  Treasury,  and  hereafter  received,  ^^^^^^diary  saver 
to   be    recoined,    and    to    reimburse    the    Treasurer   of    the    United 
States  for  the  difference  between  the  nominal  or  face  value  of  such 
coin  and  the  amount  the  same  will  produce  in  new  coin  from  any 
moneys  in  the  Treasury  not  otherwise  appropriated. 

Sec.    10.  That    section    fifty-one    hundred    and    thirty-eight    of 
tiie  Revised  Statutes  is  hereby  amended  so  as  to  read  as  follows: 


156  N.    W.    HALSEY    &   CO. 

Amendment  to  "Section  5 1 38.  No  association  shall  be  organized  with  a  less 
section  5138.  capital  than  one  hundred  thousand  dollars,  except  that  banks  with 
*^'  '^'  a  capital  of  not  less  than  fifty  thousand  dollars  may,  with  the 
approval  of  the  Secretary  of  the  Treasury,  be  organized  in  any 
place  the  population  of  which  does  not  exceed  six  thousand  inhab- 
itants, and  except  that  banks  with  a  capital  of  not  less  than  twenty- 
five  thousand  dollars  may,  with  the  sanction  of  the  Secretary  of 
the  Treasury,  be  organized  in  any  place  the  population  of  which 
does  not  exceed  three  thousand  inhabitants.  No  association  shall 
be  organized  in  a  city  the  population  of  which  exceeds  fifty  thousand 
persons  with  a  capital  of  less  than  two  hundred  thousand  dollars." 

Exchange  of  Sec.  1 1 .  That  the  Secretary  of  the  Treasury  is  hereby 
outstanding  authorized  to  receive  at  the  Treasury  any  of  the  out- 
U.  S.  bonds  standing  bonds  of  the  United  States  bearing  interest  at 
authonzed.  £^g  pgj.  centum  per  annum,  payable  February  first,  nine- 
teen hundred  and  four,  and  any  bonds  of  the  United 
States  bearing  interest  at  four  per  centum  per  annum, 
payable  July  first,  nineteen  hundred  and  seven,  and  any 
bonds  of  the  United  States  bearing  interest  at  three  per 
centum  per  annum,  payable  August  first,  nineteen  hundred 
and  eight,  and  to  issue  in  exchange  therefor  an  equal 
amount  of  coupon  or  registered  bonds  of  the  United 
States  in  such  form  as  he  may  prescribe,  in  denominations 
of  fifty  dollars  or  any  multiple  thereof,  bearing  interest  at 
the  rate  of  two  per  centum  per  annum,  payable  quarterly, 
such  bonds  to  be  payable  at  the  pleasure  of  the  United 
States  after  thirty  years  from  the  date  of  their  issue,  and 
said  bonds  to  be  payable,  principal  and  interest,  in  gold 
coin  of  the  present  standard  value,  and  to  be  exempt  from 
the  payment  of  all  taxes  or  duties  of  the  United  States, 
as  well  as  from  taxation  in  any  form  by  or  under  State, 
municipal,  or  local  authority:  Provided,  That  such  out- 
standing bonds  may  be  received  in  exchange  at  a  valuation 
not  greater  than  their  present  worth  to  yield  an  income 
of  two  and  one-quarter  per  centum  per  annum;  and  in 
consideration  of  the  reduction  of  interest  effected,  the 
Secretary   of  the   Treasury   is  authorized   to   pay   to   the 


CURRENCY    ACT    OF    MARCH    14,    1900  157 

holders  of  the  outstanding  bonds  surrendered  for  exchange, 
out  of  any  money  in  the  Treasury  not  otherwise  appro- 
priated, a  sum  not  greater  than  the  difference  between 
their  present  worth,  computed  as  aforesaid,  and  their  par 
value,  and  the  payments  to  be  made  hereunder  shall  be 
held  to  be  payments  on  account  of  the  sinking  fund 
created  by  section  thirty-six  hundred  and  ninety-four  of 
the  Revised  Statutes:  And  provided  further.  That  the  two 
per  centum  bonds  to  be  issued  under  the  provisions  of 
this  Act  shall  be  issued  at  not  less  than  par,  and  they 
shall  be  numbered  consecutively  in  the  order  of  their  issue, 
and  when  payment  is  made  the  last  numbers  issued  shall 
be  first  paid,  and  this  order  shall  be  followed  until  all  the 
bonds  are  paid,  and  whenever  any  of  the  outstanding 
bonds  are  called  for  payment  interest  thereon  shall  cease 
three  months  after  such  call;  and  there  is  hereby  appro- 
priated out  of  any  money  in  the  Treasury  not  otherwise 
appropriated,  to  effect  the  exchanges  of  bonds  provided 
for  in  this  Act,  a  sum  not  exceeding  one-fifteenth  of  one 
per  centum  of  the  face  value  of  said  bonds,  to  pay  the 
expense  of  preparing  and  issuing  the  same  and  other 
expenses  incident  thereto. 

Sec.    1 2.  That  upon  the  deposit  with  the  Treasurer  of   Deposit  of  bonds 
the  United  States,  by  any  national  banking  association,    '*?  ^^^"'^•^ 
of  any  bonds  of  the  United  States  in  the  manner  provided   "'"^"'^^'"^  "°'"- 
by   existing   law,    such    association    shall   be    entitled   to 
receive  from  the  Comptroller  of  the  Currency  circulating 
notes  in  blank,  registered  and  countersigned  as  provided 
by  law,  equal  in  amount  to  the  par  value  of  the  bonds  so 
deposited;     and    any   national    banking    associations    now 
having  bonds  on  deposit  for  the   security  of  circulating 
notes,  and  upon  which  an  amount  of  circulating  notes  has 
been  issued  less  than  the  par  value  of  the  bonds,  shall 
be  entitled,  upon  due  application  to  the   Comptroller  of 
the   Currency,   to   receive   additional   circulating   notes   in 
blank  to  an  amount  which  will  increase  the  circulating 
notes  held  by  such  association  to  the  par  value  of  the 


158  N.    W.    HALSEY    &   CO. 


bonds  deposited,  such  additional  notes  to  be  held  and 
treated  in  the  same  way  as  circulating  notes  of  national 
banking  associations  heretofore  issued,  and  subject  to  all 
the  provisions  of  law  affecting  such  notes:  Provided,  That 
nothing  herein  contained  shall  be  construed  to  modify  or 
repeal  the  provisions  of  section  fifty-one  hundred  and 
sixty-seven  of  the  Revised  Statutes  of  the  United  States, 
authorizing  the  Comptroller  of  the  Currency  to  require 
Additional  additional  deposits  of  bonds  or  of  lawful  money  in  case  the 
secuntyj.  jjj^j-j^g^  value  of  the  bonds  held  to  secure  the  circulating 
notes  shall  fall  below  the  par  value  of  the  circulating 
notes  outstanding  for  which  such  bonds  may  be  deposited 
as  security:  And  provided  further.  That  the  circulating 
notes  furnished  to  national  banking  associations  under  the 

Denomination  provisions  of  this  Act  shall  be  of  the  denominations  pre- 
of  notes,  scribed  by  law,  except  that  no  national  banking  associa- 
tion shall,  after  the  passage  of  this  Act,  be  entitled  to 
receive  from  the  Comptroller  of  the  Currency,  or  to  issue 
or  reissue  or  place  in  circulation,  more  than  one-third  in 
amount  of  its  circulating  notes  of  the  denomination  of  five 

Total  amount  dollars:  And  provided  further.  That  the  total  amount  of 
of  notes,  such  notes  issued  to  any  such  association  may  equal  at 
any  time  but  shall  not  exceed  the  amount  at  such  time  of 
its  capital  stock  actually  paid  in:  And  provided  further. 
That  under  regulations  to  be  prescribed  by  the  Secretary 
of  the  Treasury  any  national  banking  association  may 
Substitution  of  substitute  the  two  per  centum  bonds  issued  under  the 
bonds,  provisions  of  this  Act  for  any  of  the  bonds  deposited  with 
the  Treasurer  to  secure  circulation  or  to  secure  deposits 
of  public  money;  and  so  much  of  an  Act  entitled  "An 
Act  to  enable  national  banking  associations  to  extend  their 
corporate  existence,  and  for  other  purposes,"  approved  July 
twelfth,  eighteen  hundred  and  eighty-two,  as  prohibits  any 
national  bank  which  makes  any  deposit  of  lawful  money 
in  order  to  withdraw  its  circulating  notes  from  receiving 
any  increase  of  its  circulation  for  the  period  of  six  months 
from  the  time  it  made  such  deposit  of  lawful  money  for 
the  purpose  aforesaid,  is  hereby  repealed,   and  all   other 


CURRENCY    ACT    OF    MARCH    14.    1900  159 

Acts  or  parts  of  Acts  inconsistent  with  the  provisions  of 
this  section  are  hereby  repealed. 

Sec.  13.  That  every  national  banking  association  having  Tax  on  notes, 
on  deposit,  as  provided  by  law,  bonds  of  the  United  States 
bearing  interest  at  the  rate  of  two  per  centum  per  annum, 
issued  under  the  provisions  of  this  Act,  to  secure  its  circu- 
lating notes,  shall  pay  to  the  Treasurer  of  the  United 
States,  in  the  months  of  January  and  July,  a  tax  of  one- 
fourth  of  one  per  centum  each  half  year  upon  the  average 
amount  of  such  of  its  notes  in  circulation  as  are  based 
upon  the  deposit  of  said  two  per  centum  bonds;  and  such 
taxes  shall  be  in  lieu  of  existing  taxes  on  its  notes  in 
circulation  imposed  by  section  fifty-two  hundred  and  four- 
teen of  the  Revised  Statutes. 

Sec.    14.  That  the  provisions  of  this  Act  are  not  intended  to  International 
preclude  the  accomplishment  of  international   bimetallism  whenever  oimetallism, 
conditions   shall   make  it   expedient   and   practicable   to   secure   the 
same   by   concurrent   action   of   the   leading   commercial   nations   of 
the  world  and  at  a  ratio  which  shall  insure  permanence  of  relative 
value  between  gold  and  silver. 

FAILED  NATIONAL  BANKS.  ETC. 

Provided,  That  for  the  fiscal  year  of  nineteen  hundred  and  two  Provisions   of 
and    thereafter,    a    full    and    complete   list    of    all    officers,    agents.  ^^^  ?Qrn 
clerks,  and  other  employees  of  the  office  of  the  Comptroller  of  the        ' 
Currency,    including   bank    examiners,    receivers    and    attorneys    for 
receivers,   and   clerks   employed   by   such   examiners   and   receivers, 
or   any   other  person   connected   with   the   work   of   said   office   in 
Washington  or   elsewhere,   whose   salary   or   compensation   is   paid 
from   the   Treasury   of   the   United   States   or   assessed    against   or 
collected  from  existing  or  failed  banks  under  their  supervision  or 
control,   shall   be    transmitted   to   the   Secretary   of   the    Interior   in 
accordance  with  the  provisions  of  an  Act  of  Congress   approved 
January   twelfth,  eighteen  hundred  and  eighty-five,   relating   to  the 
Official  Register:    And  provided  further.  That  the  Comptroller  of 
the  Currency  is  hereby  directed  to  include  in  his  Annual  Report  to 


160  N.    W.    HALSEY    &   CO. 

the  Speaker  of  the  House  of  Representatives,  expenses  incurred 
during  each  year,  in  liquidation  of  each  failed  national  bank 
separately. 

CORPORATION    CONTRIBUTIONS    TO    POLITICAL 
ELECTIONS  PROHIBITED. 

Act  of  ^^  ''  ^^^<^i^^  ^V  the  Senate  and  House  of  Representatives  of 
January  26,  the  United  States  of  America  in  Congress  assembled.  That  it  shall 
1907.  be  unlawful  for  any  national  bank,  or  any  corporation  organized 
by  authority  of  any  laws  of  Congress,  to  make  a  money  contribu- 
tion in  connection  with  any  election  to  any  political  office.  It  shall 
also  be  unlawful  for  any  corporation  whatever  to  make  a  money 
contribution  in  connection  with  any  election  at  which  Presidential 
and  Vice-Presidential  electors  or  a  Representative  in  Congress  is 
to  be  voted  for  or  any  election  by  any  State  legislature  of  a  United 
States  Senator.  Every  corporation  which  shall  make  any  con- 
tribution in  violation  of  the  foregoing  provisions  shall  be  subject  to 
a  fine  not  exceeding  five  thousand  dollars,  and  every  officer  or 
director  of  any  corporation  who  shall  consent  to  any  contribution 
by  the  corporation  in  violation  of  the  foregoing  provisions  shall 
upon  conviction  be  punished  by  a  fine  of  not  exceeding  one  thousand 
and  not  less  than  two  hundred  and  fifty  dollars,  or  by  imprison- 
ment for  a  term  of  not  more  than  one  year,  or  both  such  fine  and 
imprisonment  in  the  discretion  of  the  court. 


^     Additional  Circulation  Act 

(Emergency  Currency  Act) 


Be  it  enacted  fcp  the  Senate  and  House  of  Represenatives  of    National 
the  United  States  of  America  in  Congress  assembled.  That  national    currency) 
banking    associations,    each   having    an    unimpaired    capital    and    a    o^oaattora. 
surplus  of  not  less  than  twenty  per  centum,   not  less  than   ten   in 
number,   having  an  aggregate  capital   and  surplus  of   at  least  five 
millions  of  dollars,  may  form  voluntary  associations  to  be  designated 
as  national  currency  associations.     The  banks  uniting  to  form  such 
association  shall,  by  their  presidents  or  vice-presidents,  acting  under 
authority    from    the   board   of    directors,    make    and    file    with    the     Certificate  to  be 
Secretary  of  the  Treasury  a  certificate  setting  forth  the  names  of    ^'^"  ^^^" 
the  banks  composing  the  association,  the  principal  place  of  business     ^       ^^  ^' 
of   the  association,   and  the  name  of  the   association,   which   name 
shall  be  subject  to  the  approval  of  the  Secretary  of  the  Treasury. 
Upon    the    filing   of   such   certificate    the    associated    banks    therein 
named    shall    become    a    body    corporate,    and    by    the    name    so 
designated  and  approved  may  sue   and  be   sued   and  exercise   the 
powers  of  a  body  corporate  for  the  purposes  hereinafter  mentioned:  * 
Provided,  That  not  more  than  one  such  national  currency  associa- 
tion shall  be  formed  in  any  city:  Provided  further.  That  the  several     Membership. 
members  of   such  national  currency  association   shall   be   taken,   as 
nearly   as   conveniently   may   be,    from   a   territory   composed   of   a 
State  or  part  of  a  State,  or  contiguous  parts  of  one  or  more  States: 
And  provided  further.   That   any   national   bank   in   such   city   or 
territory,  having  the  qualifications  herein  prescribed  for  membership 
in   such   national   currency   association,    shall,    upon   its    application 
to   and   upon   the   approval  of  the  Secretary  of   the   Treasury,    be 
admitted  to  membership  in  a  national  currency  association  for  that 
city  or  territory,   and  upon   such   admission  shall   be  deemed   and 
held  a  part  of   the  body   corporate,   and   as   such   entitled   to   all 


162    N.    W.    HALSEY    &   CO. 

Bank  ^ap  the   rights   and  privileges   and   subject   to   all   the   liabilities   of   an 
belong  to  but  original  member:   And  provided  further.  That  each  national  currency 
one  association,  association   shall   be   composed   exclusively   of   banks   not   members 
of   any  other   national   currency   association. 

The   dissolution,   voluntary   or   otherwise,   of   any   bank   in   such 

association  shall  not  affect  the  corporate  existence  of  the  association 

unless  there  shall  then  remain  less  than  the  minimum  number  of  ten 

banks:  Provided,  however.  That  the  reduction  of  the  number  of 

said  banks  below  the  minimum  of  ten  shall  not  affect  the  existence 

of  the  corporation  with  respect  to  the  assertion  of  all  rights  in  favor 

of  or  against  such  association.     The  affairs  of  the  association  shall 

Management,  be  managed  by  a  board  consisting  of  one  representative  from  each 

B}f-laT»s.  bank.      By-laws    for    the    government    of   the   association   shall    be 

made  by  the  board,  subject  to  the  approval  of  the  Secretary  of  the 

Officers.   Treasury.      A    president,    vice-president,    secretary,    treasurer,    and 

an   executive   committee   of   not   less   than   five   members,    shall   be 

Powers  of  board,  elected  by  the  board.     The  powers  of  such  board,  except  in  the 

election  of  officers  and  making  of  by-laws,  may  be  exercised  through 

its  executive  committee. 

Purposes.       The   national  currency  association  herein  provided   for 

shall  have  and  exercise  any  and  all  powers  necessary  to 

carry  out  the  purposes  of  this  section,  namely,  to  render 

available,  under  the  direction  and  control  of  the  Secretary 

Securities  of  the  Treasury,  as  a  basis  for  additional  circulation  any 

basis  for  securities,  including  commercial  paper,  held  by  a  national 

additional  banking  association.     For  the  purpose  of  obtaining  such 

additional  circulation,  any  bank  belonging  to  any  national 

Application  b^  currency  association,  having  circulating  notes  outstanding 

mem  e  s  oj  ggj.yj.gjj  ^y  ^jjg  deposit  of  bonds  of  the  United  States  to  an 
association  for  ■^  ^ 

additional  an^ount  not  less  than  forty  per  centum  of  its  capital  stock, 

circulation,  and  which  has  its  capital  unimpaired  and  a  surplus  of  not 
less  than  twenty  per  centum,  may  deposit  with  and  trans- 
fer to  the  association,  in  trust  for  the  United  States,  for 

Deposit  of  *^^  purpose  hereinafter  provided,  such  of  the  securities 
securities,  above  mentioned  as  may  be  satisfactory  to  the  board  of 
the  association.  The  officers  of  the  association  may  there- 
upon,  in  behalf  of   such   bank,   make   application   to   the 


ADDITIONAL   CIRCULATION    ACT  163 

Comptroller  of  the   Currency  for  an   issue   of   additional  Additional 

circulating   notes   to   an   amount   not   exceeding   seventy-  circulation 

five  per  centum  of  the  cash  value  of  the  securities  or  com-  "United  to 

mercial  paper  so  deposited.    The  Comptroller  of  the  Cur-  ^^/c^i^m  of 

rency  shall  immediately  transmit  such  application  to  the   cash  value  of 

Secretary  of  the  Treasury  with  such  recommendation  as  commercial 

he  thinks  proper,  and  if,  in  the  judgment  of  the  Secretary  securities. 

of  the  Treasury,  business  conditions  in  the  locality  demand 

additional    circulation,    and    if    he    be    satisfied    with    the 

i-    character  and  value  of  the  securities  proposed  and  that 

a  lien  in  favor  of  the  United  States  on  the  securities  so 

deposited  and  on  the  assets  of  the  banks  composing  the 

association  will  be  amply  sufficient  for  the  protection  of 

the  United  States,  he  may  direct  an  issue  of  additional 

circulating   notes   to   the   association,    on   behalf   of   such 

bank,    to    an    amount    in    his    discretion,    not,    however, 

exceeding  seventy-five  per  centum  of  the   cash  value  of 

the    securities    so    deposited:     Provided,     That    upon    the 

deposit  of  any  of  the  State,  city,  town,  county,  or  other 

municipal  bonds,  of  a  character  described  in  section  three 

of  this  Act,  circulating  notes  may  be  issued  to  the  extent 

of  not  exceeding  ninety  per  centum  of  the  market  value  of  w. 

such  bonds  so  deposited:      And    provided    further.  That  no  centum 

national  banking  association  shall   be   authorized   in   any  in  case  of 

event  to  issue  circulating  notes  based  on  commercial  paper  municipals. 

in  excess  of  thirty  per  centum  of  its  unimpaired  capital  Additional 

and  surplus.     The  term  "commercial  paper"  shall  be  held  limitations. 

to    include    only    notes    representing    actual    commercial  ^  .  , 

,  .  ,         ,  ,    ,         ,  .     .        Commercial 

transactions,    which    when    accepted    by    the    association  papQj-^ 

shall  bear  the  names  of  at  least  two  responsible  parties 

and  have  not  exceeding  four  months  to  run. 

The  banks  and  the  assets  of  all  banks  belonging  to  the  Liability  of 

association   shall   be    jointly   and   severally    liable    to    the  members  of 

United    States    for    the    redemption    of    such    additional  association. 

circulation;  and  to  secure  such  liability  the  lien  created 

by  section  fifty-two   hundred  and  thirty  of   the   Revised 

Statutes  shall  extend  to  and  cover  the  assets  of  all  banks 

belonging  to  the  association,  and  to  the  securities  deposited 


164 N.    W.    HALSEY    &   CO. 

by  the  banks  with  the    association  pursuant  to  the  provi- 
sions of  this  Act;  but  as  between  the  several  banks  com- 
posing  such   association  each   bank   shall   be   liable   only 
in  the   proportion   that   its   capital  and   surplus   bears   to 
the  aggregate  capital  and  surplus  of  all  such  banks.    The 
association  may,  at  any  time,  require  of  any  of  its  con- 
Additional  stituent  banks  a  deposit  of  additional  securities  or  com- 
securities.  mercial  paper,   or  an   exchange  of  the   securities   already 
on  deposit,  to  secure  such  additional  circulation;  and  in 
Failure  to  ^^^^  ^^  *^^  failure  of  such  bank  to  make  such  deposit  or 
deposit,  exchange  the  association  may,  after  ten  days'  notice  to  the 
bank,  sell  the  securities  and  paper  already  in  its  hands  at 
public  sale,  and  deposit  the  proceeds  with  the  Treasurer 
of  the  United  States  as  a  fund  for  the  redemption  of  such 
additional    circulation.     If   such   fund   be   insufficient    for 
that  purpose  the  association  may  recover  from  the  bank 
Associations  the  amount  of  the  deficiency  by  suit  in  the  circuit  court 
ma})  be  sued  in  of  the  United  States,  and  shall  have  the  benefit  of  the  lien 
U.  S.  circuit  hereinbefore  provided  for  in  favor  of  the  United  States 
^"""^  *  upon  the   assets   of  such  bank.     The  association   or  the 
Secretary  of  the  Treasury  may  permit  or  require  the  with- 
drawal of  any  such  securities  or  commercial  paper  and 
Substitution  of  *^®  substitution  of  other  securities  or  commercial  paper 
securities,  of  equal  value  therefor. 

Redemption  Sec.  2.  That  whenever  any  bank  belonging  to  a 
fund,  national  currency  association  shall  fail  to  preserve  or 
make  good  its  redemption  fund  in  the  Treasury  of  the 
United  States,  required  by  section  three  of  the  Act  of 
June  twentieth,  eighteen  hundred  and  seventy-four,  chapter 
three  hundred  and  fourty-three,  and  the  provisions  of 
this  Act,  the  Treasurer  of  the  United  States  shall  notify 
such  national  currency  association  to  make  good  such 
Failure  to  redemption  fund,  and  upon  the  failure  of  such   national 

make  good,  currency  association  to  make  good  such  fund,  the 
Treasurer  of  the  United  States  may,  in  his  discretion,  apply 
so  much  of  the  redemption  fund  belonging  to  the  other 
banks   composing   such   national   currency   association   as 


ADDITIONAL   CIRCULATION    ACT  165 

may  be  necessary  for  that  purpose;  and  such  national 
currency  association  may,  after  five  days'  notice  to  such 
bank,  proceed  to  sell  at  public  sale  the  securities  deposited 
by  such  bank  with  the  association  pursuant  to  the  provi- 
sions of  section  one  of  this  Act,  and  deposit  the  proceeds 
with  the  Treasurer  of  the  United  States  as  a  fund  for  the 
redemption  of  the  additional  circulation  taken  out  by  such 
bank  under  this  Act. 

Sec.  3.   That   any   national   banking   association   which  Application  fc]> 
has  circulating  notes  outstanding,  secured  by  the  deposit  association  as  a 

of  United  States  bonds  to  an  amount  of  not  less   than  ''f'^^°\''lt  ^°  ,^ 

.    ,  ,  •■       ,  •  ,     1  iOT  additional 

forty  per  centum  of  its  capital  stock,  and  which  has  a  circulation. 

surplus  of  not  less  than  twenty  per  centum,  may  make 
application  to  the  Comptroller  of  the  Currency  for  author- 
ity to  issue  additional  circulating  notes  to  be  secured  by 
the  deposit  of  bonds  other  than  bonds  of  the  United  States. 
The  Comptroller  of  the  Currency  shall  transmit  immedi- 
ately the  application,  with  his  recommendation,  to  the 
Secretary  of  the  Treasury,  who  shall,  if  in  his  judgment 
business  conditions  in  the  locality  demand  additional 
circulation,  approve  the  same,  and  shall  determine  the 
time  of  issue  and  fix  the  amount,  within  the  limitations 
herein  imposed,  of  the  additional  circulating  notes  to  be 
issued.  Whenever  after  receiving  notice  of  such  approval 
any  such  association  shall  deposit  with  the  Treasurer  or  Deposit  of 
any  assistant  treasurer  of  the  United  States  such  of  the  securities. 
bonds  described  in  this  section  as  shall  be  approved  in 
character  and  amount  by  the  Treasurer  of  the  United 
States  and  the  Secretary  of  the  Treasury,  it  shall  be  en- 
titled to  receive,  upon  the  order  of  the  Comptroller  of  the 
Currency,  circulating  notes  in  blank,  registered  and  Additional 
countersigned  as  provided  by  law,  not  exceeding  in  amount  circulation 

ninety  per  centum  of  the  market  value,  but  not  in  excess  ''f""f"  '^ 

r    ,  ■,  r  ,,  ,  .,  ,  ,        nmety  per 

of  the  par  value  of  any  bonds  so  deposited,  such  market  centum  of 

value  to  be  ascertained  and  determined  under  the  direction  market  value 

of  the  Secretary  of  the  Treasury.  of  securities. 


166  N.    W.    HALSEY    &   CO. 


Bonds  available  The  Treasurer  of  the  United  States,  with  the  approval 
for  security,  of  the  Secretary  of  the  Treasury,  shall  accept  as  security 
for  the  additional  circulating  notes  provided  for  in  this 
section,  bonds  or  other  interest-bearing  obligations  of  any 
State  of  the  United  States,  or  any  legally  authorized  bonds 
issued  by  any  city,  town,  county,  or  other  legally  consti- 
tuted municipality  or  district  in  the  United  States  which 
has  been  in  existence  for  a  period  of  ten  years,  and  which 
for  a  period  of  ten  years  previous  to  such  deposit  has  not 
defaulted  in  the  payment  of  any  part  of  either  principal 
or  interest  of  any  funded  debt  authorized  to  be  contracted 
by  it,  and  whose  net  funded  indebtedness  does  not  exceed 
ten  per  centum  of  the  valuation  of  its  taxable  property, 
to  be  ascertained  by  the  last  preceding  valuation  of 
property  for  the  assessment  of  taxes.  The  Treasurer  of 
the  United  States,  with  the  approval  of  the  Secretary  of 
the  Treasury,  shall  accept,  for  the  purposes  of  this  section, 
securities  herein  enumerated  in  such  proportions  as  he  may 
from  time  to  time  determine,  and  he  may  with  such 
approval  at  any  time  require  the  deposit  of  additional 
securities,  or  require  any  association  to  change  the  charac- 
ter of  the  securities  already  on  deposit. 

Legal  title  of  Sec.  4.  That  the  legal  title  of  all  bonds,  whether  coupon 
bonds  to  be  or  registered,  deposited  to  secure  circulating  notes  issued 
ransjerre  .  -^^  accordance  with  the  terms  of  section  three  of  this  Act 
shall  be  transferred  to  the  Treasurer  of  the  United  States 
in  trust  for  the  association  depositing  them,  under  regula- 
tions to  be  prescribed  by  the  Secretary  of  the  Treasury. 
A  receipt  shall  be  given  to  the  association  by  the  Treasurer 
or  any  assistant  treasurer  of  the  United  States,  stating 
that  such  bond  is  held  in  trust  for  the  association  on  whose 
behalf  the  transfer  is  made,  and  as  security  for  the  redemp- 
tion and  payment  of  any  circulating  notes  that  have  been 
or  may  be  delivered  to  such  association.  No  assignment 
or  transfer  of  any  such  bond  by  the  Treasurer  shall  be 
deemed  valid  unless  countersigned  by  the  Comptroller  of 
the  Currency.    The  provisions  of  sections  fifty-one  hundred 


ADDITIONAL   CIRCULATION    ACT  167 


and  sixty-three,  fifty-one  hundred  and  sixty-four,  fifty-one 
hundred  and  sixty-five,  fifty-one  hundred  and  sixty-six, 
and  fifty-one  hundred  and  sixty-seven  and  sections  fifty- 
two  hundred  and  twenty-four  to  fifty-two  hundred  and 
thirty-four,  inclusive,  of  the  Revised  Statutes  respecting 
United  States  bonds  deposited  to  secure  circulating  notes 
shall,  except  as  herein  modified,  be  applicable  to  all  bonds 
deposited  under  the  terms  of  section  three  of  this  Act. 

Sec.  5.   That  the  additional  circulating  notes  issued  under  Status  of 
this  Act  shall  be  used,  held,  and  treated  in  the  same  way  additional 
as  circulating  notes  of  national  banking  associations  here-  circulating  notes. 
tofore  issued  and  secured  by  a  deposit  of  United  States 
bonds,  and  shall  be  subject  to  all  the  provisions  of  law 
affecting  such  notes  except  as  herein  expressly  modified: 
Provided,     That  the  total  amount  of  circulating  notes  out- 
standing  of   any   national   banking   association,    including 
notes  secured  by  United  States  bonds  as  now  provided  by 
law,  and  notes  secured  otherwise  than  by  deposit  of  such 
bonds,   shall  not  at  any  time  exceed  the   amount   of  its  [^irnit  of  issue, 
unimpaired    capital    and    surplus:       And     provided     further. 
That  there  shall  not  be  outstanding  at  any  time  circulating 
notes  issued  under  the  provisions  of  this  Act  to  an  amount 
of  more  than  five  hundred  millions  of  dollars. 

Sec.  6.   That   whenever   and   so   long   as   any   national  Amount  in 

banking  association  has  outstanding  any  of  the  additional  redemption  fund 

circulating  notes  authorized  to  be  issued  by  the  provisions  """(  fo^^'" 

of  this  Act  it  shall  keep  on  deposit  in  the  Treasury  of  the  ^"'''''o"^' 

^  ^  ,        .      ,  .      ,   circulation. 

United  States,  in  addition  to  the  redemption  fund  required 

by  section  three  of  the  Act  of  June  twentieth,  eighteen 
hundred  and  seventy-four,  an  additional  sum  equal  to  five 
per  centum  of  such  additional  circulation  at  any  time  out- 
standing, such  additional  five  per  centum  to  be  treated, 
held,  and  used  in  all  respects  in  the  same  manner  as  the 
original  redemption  fund  provided  for  by  said  section  three 
of  the  Act  of  June  twentieth,  eighteen  hundred  and 
seventy-four. 


168  N.    W.    HALSEY    &   CO. 

Distribution  •^^c.  7.  In  order  that  the  distribution  of  notes  to  be 
of  notes  issued  under  the  provisions  of  this  Act  shall  be  made  as 
geographically),  equitable  as  practicable  between  the  various  sections  of 
the  country,  the  Secretary  of  the  Treasury  shall  not 
approve  applications  from  associations  in  any  State 
in  excess  of  the  amount  to  vi^hich  such  State  would  be 
entitled  of  the  additional  notes  herein  authorized  on  the 
basis  of  the  proportion  which  the  unimpaired  capital  and 
surplus  of  the  national  banking  associations  in  such  State 
bears  to  the  total  amount  of  unimpaired  capital  and  surplus 
of  the  national  banking  associations  of  the  United  States: 
Provided,  hoTvever,  That  in  case  the  applications  from 
associations  in  any  State  shall  not  be  equal  to  the  amount 
which  the  associations  of  such  State  would  be  entitled 
to  under  this  method  of  distribution,  the  Secretary  of  the 
Treasury  may,  in  his  discretion,  to  meet  an  emergency, 
assign  the  amount  not  thus  applied  for  to  any  applying 
association  or  associations  in  States  in  the  same  section 
of  the  country. 

Information        Sec.  8.     That  it  shall  be  the  duty  of  the  Secretary  of 
relative  to  value  ^he  Treasury  to  obtain  information  with  reference  to  the 

of  SCCllTltlCS 

17  7  value  and  character  of  the  securities  authorized  to  be 
accepted  under  the  provisions  of  this  Act,  and  he  shall 
from  time  to  time  furnish  information  to  national  banking 
associations  as  to  such  securities  as  would  be  acceptable 
under  the  provisions  of  this  Act. 

Amendment  to       Sec.  9.     That  section  fifty-two  hundred  and  fourteen  of 
section  ^'^,  tijg  Revised  Statutes,  as  amended,  be  further  amended  to 
'    *  read  as  follows: 

Tax  on  "Sec.  5214.  National  banking  associations  having  on 
circulation,  deposit  bonds  of  the  United  States,  bearing  interest  at  the 
rate  of  two  per  centum  per  annum,  including  the  bonds 
issued  for  the  construction  of  the  Panama  Canal,  under 
the  provisions  of  section  eight  of  'An  Act  to  provide  for 
the  construction  of  a  canal  connecting  the  waters  of  the 


ADDITIONAL   CIRCULATION   ACT  169 

Atlantic  and  Pacific  oceans,'  approved  June  twenty-eighth,  5ecure J  b\) 
nineteen  hundred  and  two,  to  secure  its  circulating  notes,  U.  S.  bonds. 
shall  pay  to  the  Treasurer  of  the  United  States,  in  the 
months  of  January  and  July,  a  tax  of  one-fourth  of  one 
per  centum  each  half  year  upon  the  average  amount  of 
such  of  its  notes  in  circulation  as  are  based  upon  the  deposit 
of  such  bonds;  and  such  associations  having  on  deposit 
bonds  of  the  United  States  bearing  interest  at  a  rate  higher 
than  two  per  centum  per  annum  shall  pay  a  tax  of  one-half 
of  one  per  centum  each  half  year  upon  the  average  amount 
of  such  of  its  notes  in  circulation  as  are  based  upon  the 
deposit  of  such  bonds.  National  banking  associations  Secured  h\)  other 
having  circulating  notes  secured  otherwise  than  by  bonds  than  U.  S.  bonds. 
of  the  United  States  shall  pay  for  the  first  month  a  tax 
at  the  rate  of  five  per  centum  per  annum  upon  the  average 
amount  of  such  of  their  notes  in  circulation  as  are  based 
upon  the  deposit  of  such  securities,  and  afterwards  an 
additional  tax  of  one  per  centum  per  annum  for  each 
month  until  a  tax  of  ten  per  centum  per  annum  is  reached, 
and  thereafter  such  tax  of  ten  per  centum  per  annum,  upon 
the  average  amount  of  such  notes.  Every  national 
banking  association  having  outstanding  circulating  notes 
secured  by  a  deposit  of  other  securities  than  United 
States  bonds  shall  make  monthly  returns,  under  oath  of  Monthly  returns 
its  president  or  cashier,  to  the  Treasurer  of  the  United  under  oath. 
States,  in  such  form  as  the  Treasurer  may  prescribe,  of 
the  average  monthly  amount  of  its  notes  so  secured  in 
circulation;  and  it  shall  be  the  duty  of  the  Comptroller 
of  the  Currency  to  cause  such  reports  of  notes  in  circula- 
tion to  be  verified  by  examination  of  the  bank's  records. 
The  taxes  received  on  circulating  notes  secured  otherwise 
than  by  bonds  of  the  United  States  shall  be  paid  into 
the  Division  of  Redemption  of  the  Treasury  and  credited 
and  added  to  the  reserve  fund  held  for  the  redemption  of 
United  States  and  other  notes."  " 

Sec.    10.      That  section  nine  of  the  Act  approved  July  twelfth,  Amendment 
eighteen  hundred  and  eighty-two,  as  amended  by  the  Act  approved  to  R.  S. 


170 N.    W.    HALSEY    &   CO. 

March  fourth,  nineteen  hundred  and  seven,  be  further  amended  to 
read  as  follows: 

Withdrawal  of  "Sec.  9.  That  any  national  banking  association  desiring 
circulating  notes,  ^q  withdraw  its  circulating  notes,  secured  by  deposit  of 
United  States  bonds  in  the  manner  provided  in  section 
four  of  the  Act  approved  June  twentieth,  eighteen  hundred 
and  seventy-four,  is  hereby  authorized  for  that  purpose 
to  deposit  lawful  money  with  the  Treasurer  of  the  United 
States  and,  with  the  consent  of  the  Comptroller  of  the 
Currency  and  the  approval  of  the  Secretary  of  the  Treas- 
ury to  withdraw  a  proportionate  amount  of  bonds  held 
as  security  for  its  circulating  notes  in  the  order  of  such 
deposits:  Provided,  That  not  more  than  nine  millions  of 
dollars  of  lawful  money  shall  be  so  deposited  during  any 
calendar  month  for  this  purpose. 

"Any  national  banking  association  desiring  to  withdraw 
any  of  its  circulating  notes,  secured  by  the  deposit  of 
securities  other  than  bonds  of  the  United  States,  may  make 
such  withdrawal  at  any  time  in  like  manner  and  effect  by 
the  deposit  of  lawful  money  or  national  bank  notes  with 
the  Treasurer  of  the  United  States,  and  upon  such  deposit 
a  proportionate  share  of  the  securities  so  deposited  may  be 
withdrawn:  Provided,  That  the  deposits  under  this  section 
to  retire  notes  secured  by  the  deposit  of  securities  other 
than  bonds  of  the  United  States  shall  not  be  covered  into 
the  Treasury,  as  required  by  section  six  of  an  Act  entitled 
*An  Act  directing  the  purchase  of  silver  bullion  and  the 
issue  of  Treasury  notes  thereon,  and  for  other  purposes,' 
approved  July  fourteenth,  eighteen  hundred  and  ninety, 
but  shall  be  retained  in  the  Treasury  for  the  purpose  of 
redeeming  the  notes  of  the  bank  making  such  deposit." 

Amendment  to        Sec.    1  1 .  That  section  fifty-one  hundred  and  seventy-two  of  the 
section  ^''^'    Revised  Statutes  be,  and  the  same  is  hereby,  amended  to  read  as 
^'^'    follows: 


ADDITIONAL   CIRCULATION    ACT  171 

"Sec.  5 1  72.  In  order  to  furnish  suitable  notes  for  circulation,  the  p,-jnfinp  of 
Comptroller  of  the  Currency  shall,  under  the  direction  of  the  circulating  notes. 
Secretary  of  the  Treasury,  cause  plates  and  dies  to  be  engraved, 
in  the  best  manner  to  guard  against  counterfeiting  and  fradulent 
alterations,  and  shall  have  printed  therefrom,  and  numbered,  such 
quantity  of  circulating  notes,  in  blank,  of  the  denominations  of 
five  dollars,  ten  dollars,  twenty  dollars,  fifty  dollars,  one  hundred 
dollars,  five  hundred  dollars,  one  thousand  dollars,  and  ten 
thousand  dollars,  as  may  be  required  to  supply  the  associations 
entitled  to  receive  the  same.  Such  notes  shall  state  upon  their  face 
that  they  are  secured  by  United  States  bonds  or  other  securities, 
certified  by  the  written  or  engraved  signatures  of  the  Treasurer 
and  Register  and  by  the  imprint  of  the  seal  of  the  Treasury. 
They  shall  also  express  upon  their  face  the  promise  of  the  associa- 
tion receiving  the  same  to  pay  on  demand,  attested  by  the  signature 
of  the  president  or  vice-president  and  cashier.  The  Comptroller  of 
the  Currency,  acting  under  the  direction  of  the  Secretary  of  the 
Treasury,  shall  as  soon  as  practicable  cause  to  be  prepared  circu- 
lating notes  in  blank,  registered  and  countersigned,  as  provided  by 
law,  to  an  amount  equal  to  fifty  per  centum  of  the  capital  stock 
of  each  national  banking  association;  such  notes  to  be  deposited  Distribution. 
in  the  Treasury  or  in  the  subtreasury  of  the  United  States  nearest 
the  place  of  business  of  each  association,  and  to  be  held  for  such 
association,  subject  to  the  order  of  the  Comptroller  of  the  Currency, 
for  their  delivery  as  provided  by  law:  Provided,  That  the 
Comptroller  of  the  currency  may  issue  national  bank  notes  of  the 
present  form  until  plates  can  be  prepared  and  circulating  notes 
issued  as  above  provided:  Provided,  however.  That  in  no  event 
shall  bank  notes  of  the  present  form  be  issued  to  any  bank  as 
additional  circulation  provided  for  by  this  Act." 

Sec.    1 2.     That  circulating  notes  of  national  banking  associa-  Redemption  at 
tions,  when  presented  to  the  Treasury  for  redemption,  as  provided   "^<^^^V' 
in    section    three    of    the    Act    approved    June    twentieth,    eighteen 
hundred  and  seventy-four,  shall  be  redeemed  in  lawful  money  of 
the  United  States. 


172 N.    W.    HALSEY    &   CO. 

Authority.  Sec.  1  3.  That  all  acts  and  orders  of  the  Comptroller  of  the 
Currency  and  the  Treasurer  of  the  United  States  authorized  by 
this  Act  shall  have  the  approval  of  the  Secretary  of  the  Treasury 
v/ho  shall  have  power,  also,  to  make  any  such  rules  and  regulations 
and  exercise  such  control  over  the  organization  and  management 
of  national  currency  associations  as  may  be  necessary  to  carry  out 
the  purposes  of  this  Act. 

Public  deposits.  Sec.  14.  That  the  provisions  of  section  fifty-one  hundred  and 
ninety-one  of  the  Revised  Statues,  with  reference  to  the  reserves 
of  national  banking  associations,  shall  not  apply  to  deposits  of  public 
moneys  by  the  United  States  in  designating  depositaries. 

Interest  on  Sec.  1  5.  That  all  national  banking  associations  designated  as 
deposits,  regular  depositaries  of  public  money  shall  pay  upon  all  special 
and  additional  deposits  made  by  the  Secretary  of  the.  Treasury 
in  such  depositaries,  and  all  such  associations  designated  as 
temporary  depositaries  of  public  money  shall  pay  upon  all  sums 
of  public  money  deposited  in  such  associations  interest  at  such  rate 
as  the  Secretary  of  the  Treasury  may  prescribe,  not  less,  however, 
than  one  per  centum  per  annum  upon  the  average  monthly  amount 
of  such  deposits  :ProviJe J,  however.  That  nothing  contained  in 
this  Act  shall  be  construed  to  change  or  modify  the  obligation  of 
any  association  or  any  of  its  officers  for  the  safe-keeping  of  public 
money:  Provided,  further,  that  the  rate  of  interest  charged  upon 
such  deposits  shall  be  equal  and  uniform  throughout  the  United 
States. 

•  Appropriation       Sec.    1 6.     That  a  sum  sufficient  to  carry  out  the  purposes  of 
to  carr^  out  act.   the  preceding  sections  of   this  Act  is  hereby   appropriated   out  of 
any  money  in  the  Treasury  not  otherwise  appropriated. 

National        Sec.    1 7.      That  a  Commission  is  hereby  created,  to  be  called 
Monetary  the   "National    Monetary   Commission,"    to   be   composed   of   nine 
Commission,   members  of  the  Senate,  to  be  appointed  by  the   Presiding  Officer 
thereof,  and  nine  members  of  the  House  of  Representatives,  to  be 
appointed  by  the  Speaker  thereof;  and  any  vacancy  on  the  Com- 
mission shall  be  filled  in  the  same  manner  as  the  original  appointment. 

Sec.  1  8.     That  it  shall  be  the  duty  of  this  Commission  to  inquire 
into  and  report  to  Congress  at  the  earliest  date  practicable,  what 


ADDITIONAL   CIRCULATION    ACT 


173 


changes  are  necessary  or  desirable  in  the  monetary  system  of  the  Dut})  of 
United  States  or  in  the  laws  relating  to  banking  and  currency,  commission. 
and  for  this  purpose  they  are  authorized  to  sit  during  the  sessions 
or  recess  of  Congress,  at  such  times  and  places  as  they  may  deem 
desirable,  to  send  for  persons  and  papers,  to  administer  oaths, 
to  summons  and  compel  the  attendance  of  witnesses,  and  to  employ 
a  disbursing  officer  and  such  secretaries,  experts,  stenographers, 
messengers,  and  other  assistants  as  shall  be  necessary  to  carry  out 
the  purposes  for  which  said  Commission  was  created.  The  Com- 
mission shall  have  the  power,  through  subcommittee  or  otherwise, 
to  examine  witnesses  and  to  make  such  investigations  and  examina- 
tions, in  this  or  other  countries,  of  the  subjects  committed  to  their 
charge  as  they  shall  deem  necessary. 

Sec.  19.  That  a  sum  sufficient  to  carry  out  the  purposes  Expenses  of 
of  sections  seventeen  and  eighteen  of  this  Act,  and  to  pay  the  commission. 
necessary  expenses  of  the  Commission  and  its  members,  is  hereby 
appropriated,  out  of  any  money  in  the  Treasury  not  otherwise 
appropriated.  Said  appropriation  shall  be  immediately  available 
and  shall  be  paid  out  on  the  audit  and  order  of  the  chairman  or 
acting  chairman  of  said  Commission,  which  audit  and  order  shall 
be  conclusive  and  binding  upon  all  Departments  as  to  the  correctness 
of  the  accounts  of  such  Commission. 

Sec.  20.     That  this  Act  shall  expire  by  limitation  on  the  thirtieth    Expiration  of  act. 
day  of  June,  nineteen  hundred  and  fourteen. 

Approved.  May  30.   1908.  Date  of  act. 


<*> 


New  York  Savings  Bank  Law 


The  Banking  Laws  of  the  State  of  New  York  Relative 
TO  Securities  in  Which  Deposits  in  Savings  Banks 
May  Be  Invested,  as  Amended  and  in  Effect  May 
23.  1906. 

1 1 6.  The  trustees  of  any  Savings  Bank  may  invest  the  moneys  In  ivhat  securities 

deposited  therein  and  the  income  derived  therefrom  only  as  follows:   ^^posits  ma}f  be 

invested. 

1.  In  the  stocks  or  bonds  or  interest-bearing  notes  or  Qonds  of  the 
obligations  of  the  United  States,  or  those  for  which  the  United  States  and 
faith  of  the  United  States  is  pledged  to  provide  for  the  of  the  District  of 
payment  of  the  interest  and  principal,  including  the  bonds  Columbia. 

of  the   District  of   Columbia. 

2.  In  the  stocks  or  bonds  or  interest-bearing  obligations  Bonds  of  state 
of  this  State,  issued  pursuant  to  the  authority  of  any  law  °f  ^^^  York. 
of  the  State. 

3.  In  the  stocks  or  bonds  or  interest-bearing  obligations  Bonds  of 
of  any  State  of  the  United  States  which  has  not  within  ^^^  *^^'«^- 
ten  years  previous  to  making  such   investment  by  such 
corporation  defaulted  in  the  payment  of  any  part  of  either 
principal  or  interest  of  any  debt  authorized  by  the  Legisla- 
ture of  any  such  State  to  be  contracted;  and  in  the  bonds 

or  interest-bearing  obligations  of  any  State  of  the  United 
States,  issued  in  pursuance  of  the  authority  of  the  Legisla- 
ture of  such  State,  which  have,  prior  to  the  passage  of 
this  act,  been  issued  for  the  funding  or  settlement  of  any 
previous  obligation  of  such  State  theretofore  in  default, 
and  on  which  said  funding  or  settlement  obligation  there 
has  been  no  default  in  the  payment  of  either  principal 
or  interest  since  the  issuance  of  such  funded  or  settlement 


1^6 N.    W.    HALSEY    &   CO. 

obligation,  and  provided  the  interest  on  such  funded  or 
settlement  obligation  has  been  paid  regularly  for  a  period 
of  not  less  than  ten  years  next  preceding  such  investment. 

Bonds  of  school     4.  In  the  stocks  or  bonds  of  any  city,  county,  town  or 

districts,  counties  village,  school  district  bonds  and  union  free  school  district 

and  "i""'cipamies|jQjj^g  issued  for  school  purposes,  or  in  the  interest-bearing 

of  New  York.   ,v     *•  r  V  ^    \  -iv  c  ^u- 

obligations  of  any  city,  county,  town  or  viUiage  of  this 

State,  issued  pursuant  to  the  authority  of  any  law  of  the 

State  for  the  payment  of  which  the  faith  and  credit  of 

the  municipality  issuing  them  are  pledged. 

Bonds  of  other  5.  In  the  stocks  or  bonds  of  any  incorporated  city 
municipalities  situated  in  one  of  the  States  of  the  United  States,  which  was 
of  the  ^"''e^admitted  to  Statehood  prior  to  January  1,  1896,  and  which, 
'since  January  1,  1861,  has  not  repudiated  or  defaulted  in 
the  payment  of  any  part  of  the  principal  or  interest  of 
any  debt  authorized  by  the  Legislature  of  any  such  State 
to  be  contracted,  provided  said  city  has  a  population  as 
shown  by  the  Federal  Census  next  preceding  said  invest- 
ment of  not  less  than  45,000  inhabitants,  and  was  incorpor- 
ated as  a  city  at  least  twenty-five  years  prior  to  the  making 
of  said  investment,  and  has  not  since  January  1,  1878 
defaulted  for  more  than  ninety  days  in  the  payment  of 
any  part  either  of  principal  or  interest  of  any  bond,  note, 
or  other  evidence  of  indebtedness,  or  effected  any  com- 
promise of  any  kind  with  the  holders  thereof.  But  if,  after 
such  default  on  the  part  of  any  such  State  or  city,  the 
debt  or  security  in  the  payment  of  the  principal  or  interest 
of  which  such  default  occurred  has  been  fully  paid, 
refunded,  or  compromised  by  the  issue  of  new  securities, 
then  the  date  of  the  first  failure  to  pay  principal  or 
interest,  when  due,  upon  such  debt  or  security,  shall  be 
taken  to  be  the  date  of  such  default  within  the  provisions 
of  this  subdivision,  and  subsequent  failures  to  pay  instal- 
ments of  principal  or  interest  upon  such  debt  or  security, 
prior  to  the  refunding  or  final  payment  of  the  same,  shall 
not  be  held  to  continue  said  default  or  fix  the  time  thereof 
within  the  meaning  of  this  subdivision,  at  a  date  later  than 


NEW   YORK   SAVINGS    BANK   LAW 177 

the  date  of  said  first  failure  in  payment.  If  at  any  time  the 
indebtedness  of  any  such  city,  together  with  the  indebted- 
ness of  any  district,  or  other  municipal  corporation  or 
subdivision  except  a  county,  which  is  wholly  or  in  part 
included  within  the  bounds  or  limits  of  said  city,  less  its 
water  debt  and  sinking  funds,  shall  exceed  7  per  centum  of 
the  valuation  of  said  city  for  purposes  of  taxation,  its 
bonds  and  stocks  shall  thereafter,  and  until  such  indebted- 
ness shall  be  reduced  to  7  per  centum  of  the  valuation  for 
purposes  of  taxation,  cease  to  be  an  authorized  investment 
for  the  moneys  of  savings  banks;  but  the  Superintendent 
of  the  Banking  Department  may,  in  his  discretion,  require 
any  savings  bank  to  sell  such  bonds  or  stocks  of  said  city 
as  may  have  been  purchased  prior  to  said  increase  of  debt. 

6.  In    bonds    and    mortgages     on    unincumbered     real    Bonds  and 
property  situated  in  this  State,  to  the  extent  of  sixty  per    mortgages  on 
centum  of  the  value  thereof.     Not  more   than  sixty-five    ^^^'-  ^^'^'^• 
per  centum  of  the  whole  amount  of  deposits  shall  be  so 
loaned  or  invested.    If  the  loan  is  on  unimproved  and  un- 
productive real  property,  the  amount  loaned  thereon  shall 
not  be  more  than  forty  per  centum  of  its  actual  value. 
No  investment  in  any  bonds  and  mortgages  shall  be  made 
by  any  savings  bank  except  upon  the   report  of  a  com- 
mittee  of  its  trustees  charged  with  the  duty  of  investi- 
gating the  same,   who  shall  certify  to  the   value   of  the 
premises    mortgaged   or    to    be    mortgaged,    according    to 
their  best  judgment,  and  such  report  shall  be  filed  and 
preserved  among  the  records  of  the  corporation. 

Also  in  the  following  securities: 

(a)  The  first  mortgage  bonds  of  any  railroad  corpora-    Bonds  of  railroad 
tion  of  this  State,  the  principal  part  of  whose  railroad  is    corporations  of 
located  within  this  State,  or  of  any  railroad  corporation   ^^^  York. 
of  this  or  any  other  State  or  States  connecting  with  and 
controlled  and  operated  as  part  of  the  system  of  any  such 
railroad  corporation  of  this  State,  and  of  which  connecting 
railroad  at  least  a  majority  of  its  capital  stock  is  owned 
by   such   a   railroad   corporation   of   this    State   or   in   the 


178  N.    W.    HALSEY    &   CO. 


mortgage  bonds  of  any  such  railroad  corporation  of  an 

issue  to  retire  all  prior  mortgage  debt  of  such  railroad 

Payment  of    companies  respectively;  provided  that  at  no  time  within 

interest  and    five  years  next  preceding  the  date  of  any  such  investment 

dividends  on    shall  such  railroad  corporation  of  this  State  or  such  con- 

capia  socii    ^g^.^jj^g  railroad  corporation  respectively  have  failed  reg- 

punctual.    ularly  and  punctually  to  pay  the   matured  principal  and 

interest  of  all  its  mortgaged  indebtedness,  and  in  addition 

thereto  regularly  and  punctually  to  have  paid  in  dividends 

to    its    stockholders    during   each    of    said    five    years    an 

amount  at  least  equal  to   four  per  centum  upon  all  its 

outstanding  capital  stock;  and  provided,  further,  that  at 

the  date  of  every  such  dividend  the  outstanding  capital 

stock   of   such    railroad    corporation,    or    such    connecting 

railroad   company   respectively   shall   have   been   equal   to 

at  least  one-third  of  the  total  mortgage  indebtedness   of 

such  railroad  corporations  respectively,  including  all  bonds 

issued  or  to  be  issued  under  any  mortgage  securing  any 

bonds  in  which  such  investment  shall  be  made. 

Bonds  of  railroad  (e)  The  mortgage  bonds  of  any  railroad  corporation 
corporations  of  incorporated  under  the  laws  of  any  of  the  United  States, 
^",  which  actually  owns  in  fee  not  less  than  five  hundred 
miles  of  standard  gauge  railway  exclusive  of  sidings, 
within  the  United  States,  provided  that  at  no  time  within 
five  years  next  preceding  the  date  of  any  such  investment 
shall  such  railroad  corporation  have  failed  regularly  and 
punctually  to  pay  the  matured  principal  and  interest  of 
all  its  mortgage  indebtedness  and  in  addition  thereto 
regularly  and  punctually  to  have  paid  in  dividends  to 
its  stockholders  during  each  of  said  five  years  an  amount 
at  least  equal  to  four  per  centum  upon  all  its  outstanding 
capital  stock;  and  provided  further  that  during  said  five 
years  the  gross  earnings  in  each  year  from  the  operations 
of  said  company,  including  therein  the  gross  earnings  of 
all  railroads  leased  and  operated  or  controlled  and  operated 
by  said  company,  and  also  including  in  said  earnings  the 


States. 


NEW   YORK   SAVINGS    BANK   LAW  179 

amount  received  directly  or  indirectly  by  said  company 
from  the  sale  of  coal  from  mines  owned  or  controlled  by 
it,  shall  not  have  been  less  in  amount  than  five  times  the 
amount  necessary  to  pay  the  interest  payable  during  that 
year  upon  its  entire  outstanding  indebtedness,  and  the 
rentals  for  said  year  of  all  leased  lines,  and  further  pro- 
vided that  all  bonds  authorized  for  investment  by  this 
subdivision  shall  be  secured  by  a  mortgage  which  is  at 
the  time  of  making  said  investment  or  was  at  the  date 
of  the  execution  of  said  mortgage  (1)  a  first  mortgage 
upon  not  less  than  seventy-five  per  centum  of  the  railway 
owned  in  fee  by  the  company  issuing  said  bonds  exclusive 
of  sidings  at  the  date  of  said  mortgage  or  (2)  a  refunding 
mortgage  issued  to  retire  all  prior  lien  mortgage  debts  of 
said  company  outstanding  at  the  time  of  said  investment 
and  covering  at  least  seventy-five  per  centum  of  the  rail- 
way owned  in  fee  by  said  company  at  the  date  of  said 
mortgage.  But  no  one  of  the  bonds  so  secured  shall  be  a 
legal  investment  in  case  the  mortgage  securing  the  same 
shall  authorize  a  total  issue  of  bonds  which  together  with 
all  outstanding  prior  debts  of  said  company,  after  deduct- 
ing therefrom  in  case  of  a  refunding  mortgage,  the  bonds 
reserved  under  the  provisions  of  said  mortgage  to  retire 
prior  debts  at  maturity,  shall  exceed  three  times  the  out- 
standing capital  stock  of  said  company  at  the  time  of 
making  said  investment.  And  no  mortgage  is  to  be 
regarded  as  a  refunding  mortgage,  under  the  provisions 
of  this  act,  unless  the  bonds  which  it  secures  mature  at 
a  later  date  than  any  bond  which  it  is  given  to  refund, 
nor  unless  it  covers  a  mileage  at  least  twenty-five  per 
centum  greater  than  is  covered  by  any  one  of  the  prior 
mortgages  so  to  be  refunded. 

(f )  Any  railway  mortgage  bonds  which  would  be  a  legal  Bonds  of  railroad 

investment  under  the  provisions  of  subdivision  (e)  of  this  corporations 

section,  except  for  the  fact  that  the  railroad  corporation  oivning  less  than 

issuing   said   bonds   actually   owns   in   fee   less   than   five  ^^,f  hundred 
hundred   miles   of   road   provided   that   during   five   years 
next  preceding  the  date  of  any  such  investment  the  gross 


180 N.    W.    HALSEY    &   CO. 

earnings  in  each  year  from  the  operations  of  said  corpora- 
tion, including  the  gross  earnings  of  all  lines  leased  and 
operated  or  controlled  and  operated  by  it,  shall  not  have 
been  less  than  ten  million  dollars. 

Guaranteed  (g)  The  mortgage  bonds  of  a  railroad  corporation 
bonds,  described  in  the  foregoing  subdivisions  (e)  or  (f)  or  the 
mortgage  bond  of  a  railroad  owned  by  such  corporation, 
assumed  or  guaranteed  by  it  by  indorsement  on  said 
bonds,  provided  said  bonds  are  prior  to  and  are  to  be 
refunded  by  a  general  mortgage  of  said  corporation  the 
bonds  secured  by  which  are  made  a  legal  investment  under 
the  provisions  of  said  subdivision  (e)  or  (f) ;  and  provided, 
further,  that  said  general  mortgage  covers  all  the  real 
property  upon  which  the  mortgage  securing  said  under- 
lying bonds  is  a  lien. 

(h)  Any  railway  mortgage  bonds  which  would  be  a 
legal  investment  under  the  provisions  of  subdivisions  (e) 
or  (g)  of  this  section,  except  for  the  fact  that  the  railroad 
corporation  issuing  said  bonds  actually  owns  in  fee  less 
than  five  hundred  miles  of  road,  provided  the  payment  of 
principal  and  interest  of  said  bonds  is  guaranteed  by 
endorsement  thereon  by,  or  provided  said  bonds  have  been 
assumed  by  a  corporation  whose  first  mortgage,  or  refund- 
ing mortgage  bonds,  are  a  legal  investment  under  the 
provisions  of  subdivision  (e)  or  (f)  of  this  section.  But 
no  one  of  the  bonds  so  guaranteed  or  assumed  shall  be  a 
legal  investment  in  case  the  mortgage  securing  the  same 
shall  authorize  a  total  issue  of  bonds  which,  together 
with  all  the  outstanding  prior  debts  of  the  corporation 
making  said  guarantee  or  so  assuming  said  bonds,  includ- 
ing therein  the  authorized  amount  of  all  previously 
guaranteed  or  assumed  bond  issues,  shall  exceed  three 
times  the  capital  stock  of  said  corporation,  at  the  time  of 
making  said  investment. 

Underlying       (i)  The  first  mortgage  bonds  of  a  railroad,  the  entire 

bonds,  capital  stock  of  which,  except  shares  necessary  to  qualify 

directors,  is  owned  by,  and  which  is  operated  by  a  railroad 


NEW   YORK   SAVINGS    BANK   LAW  181 

whose  last  issued  refunding  bonds  are  a  legal  investment 
under  the  provisions  of  subdivisions  (a),  (e),  or  (f)  of 
this  section,  provided  the  payment  of  principal  and  interest 
of  said  bonds  is  guaranteed  by  endorsement  thereon  by 
the  company  so  owning  and  operating  said  road,  and 
further  provided  the  mortgage  securing  said  bonds  does 
not  authorize  an  issue  of  more  than  twenty  thousand 
dollars  in  bonds  for  each  mile  of  road  covered  thereby. 
But  no  one  of  the  bonds  so  guaranteed  shall  be  a  legal 
investment  in  case  the  mortgage  securing  the  same  shall 
authorize  a  total  issue  of  bonds,  which  together  with  all 
the  outstanding  prior  debts  of  the  company  making  said 
guarantee,  including  therein  the  authorized  amount  of  all 
previously  guaranteed  bond  issues,  shall  exceed  three  times 
the  capital  stock  of  said  company,  at  the  time  of  making 
said  investment. 

Bonds  which  have  been  or  shall  become  legal  invest- 
ments for  Savings  Banks  under  any  of  the  provisions  of 
this  act  shall  not  be  rendered  illegal  as  investments,  ^ 
though  the  property  upon  which  they  are  secured  has  been 
or  shall  be  conveyed  to  another  corporation,  and  though 
the  railroad  corporation  which  issued  or  assumed  said 
bond  has  been  or  shall  be  consolidated  with  another  rail- 
road corporation,  if  the  consolidated  or  purchasing  cor- 
poration shall  assume  the  payment  of  said  bonds  and 
shall  continue  to  pay  regularly  interest  or  dividend  or 
both  upon  the  securities  issued  against,  in  exchange  for 
or  to  acquire  the  stock  of  the  company  consolidated  or 
the  property  purchased  or  upon  securities  subsequently 
issued  in  exchange  or  substitution  therefor  to  an  amount 
at  least  equal  to  four  per  centum  per  annum  upon  the 
capital  stock  outstanding  at  the  time  of  such  consolidation 
or  purchase  of  said  corporation  which  has  issued  or 
assumed  said   bonds. 

Not  more  than  twenty-five  per  centum  of  the  assets  of   Jij^^Uniion  of 
any  bank  shall  be  loaned  or  invested  in  railroad  bonds,   lond  holdings. 
and  not  more  than  ten  per  centum  of  the  assets  of  any 
bank  shall  be  invested  in  the  bonds  of  any  one  railroad 


182  N.    W.    HALSEY   &   CO. 


corporation  described  in  paragraph  (a)  of  this  subdivision, 

and  not  more  than  five  per  centum  of  such  assets  in  the 

bonds  of  any  other  railroad  corporation.     In  determining 

the  amount  of  the  assets  of  any  bank  under  the  provisions 

of  this  subdivision  its  securities  shall  be  estimated  in  the 

manner   prescribed    for    determining    the    per    centum    of 

surplus  by  section  one   hundred  and  twenty-four  of  this 

Street  railroad  act.     Street  railroad  corporations  shall  not  be  considered 

corporations  railroad    corporations    within    the    meaning    of    this    sub- 
no/  railroad  j.   •  • 

,.       division. 
corporations. 


NOTE. 

California      Under    the    provisions    of    Section    "3"    bonds    of    the 

bonds  legal  State  of  California  are  legal  investments  for  New  York 

for  investment  Savings  Banks.    Under  the  provisions  of  Section  "5"  bonds 

Savinss  Banks  °^  *^^  cities  of  San  Francisco,  Los  Angeles  and  Oakland 

are  legal.     These  are  the  only  California  securities  which 

come  at  present  within  the  limitations  of  the  New  York 

Savings  Bank  Law.    Under  the  provisions  of  Section  "6e," 

however,  the  Southern  Pacific  Railroad  First  Refunding 

4  per  centum  bonds  and  all  underlying  issues  should  become 

legal  in  1911,  provided  dividends  on  the  Company's  stock  are 

continued  at  the  prescribed  rate. 


General  Index 


Page 

Index  to  Additional   Circulation   Act    (Emergency   Currency 

Act)    201 

Index  to  Bank  Act  of  California 1 84 

Index  to  Code  of  the  District  of  Columbia 1 98 

Index  to  Currency  Act  of  1900 200 

Index  to  Deposit  Acts  of  California 191 

Index  to   National  Bank  Act  as  Amended 1 92 

Index  to  New  York  Savings  Bank  Law 202 

Index  to  Sections  of  the  Revised  Statutes 1 99 


184  N.    W.    HALSEY    5-   CO. 


Bank  Act  of  California 


Section  Page 

Act — date  effective 147  55 

Title   I  9 

Adjustment  of  investments 14S  55 

Administrator — deposits  in  trust  company  by 92  34 

Advertising   28  18 

Advertising — capital    14  12 

Applications — investigations  of 128  43 

Articles  of  incorporation  as  affected  by  this  act 145  55 

Violation  of 134  46 

Assets — purchase  of  other  banks 31  19 

Of  banks,  purchase  by  employees 42  22 

Sale  of,  to  other  banks 31  19 

Bank — definition  of 2  9 

Banks — use  of  word  limited 12  12 

Branch    9  11 

Commercial   5  10 

Departmental    22  16 

Departmental,  certificate  required 24  17 

Departmental,  paid-up  capital 23  16 

Departmental,  relations  of  departments 26  17 

Departmental,  reserve  required 25  17 

Examination  of,  by  director 139  51 

Foreign,  inspection  of 124  41 

Funds  of,  dissolved 137  50 

In  unsound  condition 136  46 

In  unsound  condition,  neglect  to  report 126  42 

Inspection  of 124  41 

National,  examination  of 48  23 

Private    13  12 

Publication  of  financial  condition 132  45 

Purchase  of 31  19 

Report  of  departmental 129  43 

Reports  to  Superintendent 130  43 

Sale  of 31  19 

Savings   , 4  9 

Trust   companies 6  10 

Voluntary  dissolution  of 137  50 

Withheld  reports  of 138  51 

Without  capital,  to  convert  into  stock  corporation 29  18 

Bonds — deposited  by  trust  company 96  35 

Legal,  for  savings  banks 61  26 

Limitation  of  investment  in 46  23 


INDEX  185 


BANK   ACT    OF   CALIFORNIA— Con/inueJ 

Bonds — Continued  Section  Page 

Limitation  of  investment  in,  by  savings  banks 67  29 

Limitation  of  loans  by  savings  banks  on ^ 67  29 

Limitation  of  underwriting,  purchase  or  guarantee  of 36  21 

Not  legal  for  investment  by  savings  banks 61  27 

On  deposit  by  trust  company  to  draw  interest 98  36 

Branch  banks 9  11 

Call  of  county  or  municipal  deposits 7  62 

Capital — advertising  of 14  12 

Paid  up,  relation  to  deposit  liabilities 19  15 

Reduced  by  impairment 133  45 

Required  by  commercial  banks 82  32 

Required  by  savings  banks 60  24 

Required  by  trust  companies 90  33 

Stock,  investment  in  own 34  20 

Certificate  of  State  Superintendent  of  Banks 127  42 

Certificate — posting   of 50  24 

Certificates  of  deposit 63  28 

Certificates  of  deposit  taken  for  state  deposits.' 7  59 

Title  required  with  mortgages  deposited  by 99  36 

Change  of  investments  to  conform  to  act 145  55 

Claims  against  bank  in  liquidation 136  46 

Collateral — stock  of  other  banks  as 67  30 

Commercial  banks — capital  required  by 82  32 

Corporation  loans  by 81  31 

Definition  of 5  10 

Loans  by 80  31 

Loans  by,  to  directors 83  32 

Commission  to  employees  prohibited 39  22 

Condition — banks  in  unsound 136  46 

Publication  of  reports  of 132  45 

Contract  for  state  deposit 4  59 

Contracts — real  estate 35  20 

Co-partnership  18  15 

Corporation  loans  by  commercial  banks 81  31 

Corporations — foreign    7  10 

Counsel — when  may  be  employed 136  47 

Counties — deposit  law  does  not  prohibit  buying  bonds 12  64 

County  deposits 60 

County  deposits  in  savings  banks 28  62 

Officials  not  responsible  for  deposits  in  county  depositaries 9  63 

Court — report  of  Superintendent  admissible  as  evidence  in 142  54 

Courts — deposits  by  order  of 51  24 

Deceased  depositors  15  13 


186  N.    W.    HALSEY    &   CO. 


BANK   ACT    OF    CALIFORNIA— Continued 

Section  Page 

Departmental  banks.     (See  banks) 22  16 

Deposit — certificates    of 63  28 

Of  state  moneys  in  banks i  57 

Depositors — deceased    15  13 

Depositors  in  savings  banks  may  be  paid  by  draft  ■. 61  27 

Married  women    16  13 

Minors    16  13 

Unknown 15  13 

Deposits — by  order  of  court 51  24 

By  trustees   51  24 

In  trust   16  13 

In  trust  company  by  authority  of  court 91  33 

In  trust  company  by  public  administrator 92  34 

In  trust  company  by  order  of  Court 93  34 

Joint 16  13 

Limitation  of  deposits  by  savings  banks  with  other  banks 68  30 

National  banks  receiving  deposits  of  state  banks 48  23 

Of  county  moneys  in  banks 60 

Of  municipal  moneys  in  banks 60 

Payment  to  survivors 16  14 

Savings 49  23 

State,  county  and  municipal,  in  savings  banks 62  28 

Withdrawal  of,  from  savings  banks 64  28 

With  other  banks 43  22 

With  other  banks  by  savings  banks 68  30 

Deputy  superintendent  of  banks 121  39 

Directors — eligibility  of 10  11 

Examination  of  bank  by 139  51 

Loans  to,  by  commercial  banks 83  32 

May  not  borrow  of  savings  banks 65  29 

Oath II  II 

Transactions  with  bank 35  20 

Dissolution  of  bank,  voluntary 137  50 

Dividends  21  16 

Drafts — depositors  may  be  paid  by 62  27 

Employees — loans  to,  prohibited 33  20 

Transactions   with   bank 35  20 

Entries — false    38  21 

Examination  of  bank  by  directors 139  51 

Of  national  banks 48  23 

Reports  of  ^ 140  52 

Examiners — state  bank  department 125  42 


INDEX  187 

BANK   ACT    OF    CALIFORNIA— Continued 

Section  Page 

Examiner — when  not  qualified  to  examine 125  42 

Expense  of  state  banking  department 123  40 

Transporting  moneys  to  and  from  county  or  municipal  depos- 
itaries       10  63 

Transporting  moneys  to  and  from  state  depositaries i  57 

Foreign  banks — inspection  of 124  41 

Corporations    7  10 

Forfeitures   144  54 

Funds — deposit  of  with  other  banks 43  22 

Of  dissolved  banks 137  50 

Guarantee  of  bonds 36  21 

Indemnity  bonds  for  security  of  state  deposits 5  59 

Information  for  public 17-18  14-15 

On  file  for  stockholders 17  14 

Public  records  in  superintendent's  office 141  53 

Inspection  of  banks 123  40 

Of  foreign  banks 124  41 

Interest  on  county  or  municipal  deposits 2  61 

On  state  deposits i  57 

Paid  by  trust  company  as  trustee 95  35 

Unpaid,  not  profit 45  23 

When  payable  on  state  deposits 2  58 

Investment  in  bonds 46  23 

Investment  in  stocks  prohibited 36  21 

Investments — change  of,  to  conform  to  act 145  55 

Legal  for  trust  companies 105  38 

Joint  accounts   16  13 

Liabilities — deposit,  relation  to  paid-up  capital 19  15 

Liability — stockholders'    40  22 

Limit  of  county  or  municipal  deposits 5  62 

To  amount  of  state  deposit i  57 

Liquidation — by  action  of  superintendent 136  46 

Penalty  for  violation  of  law 134  46 

Loans — By  commercial  banks 80  31 

Savings  banks    67  29 

On  bonds  by  savings  banks 67  29 

On  own  capital  stock  limited 34  20 

On  real  estate 47  23 

On  real  estate  by  savings  banks 67  29 

Secured  by  bank  stocks 44  22 

To  directors  of  commercial  banks 83  32 

To  officers  or  employees  prohibited ^3  20 

Married  women  depositors 16  13 


188  N.    W.    HALSEY    &   CO. 


BANK   ACT    OF   CALIFORNIA— ConiinueJ 

Section  Page 

Mining  stocks — savings  banks  may  not  invest  in  or  loan  on 67  30 

Minors  depositors    16  13 

Mortgages 35  20 

Municipal  deposits   60 

In  savings  banks 62  2? 

Municipalities — deposit  law  does  not  prohibit  buying  bonds 12  64 

Municipal  officials  not  responsible  for  deposits  in  municipal  depos- 
itaries    9  63 

Mutual  corporations  may  have  capital  stock 29  18 

National  banks — examination  of 48  23 

Oath  of  examiner 125  42 

Obligations  of  banks — purchase  of  by  employees 41  22 

Officers — loans  to,  prohibited 33  20 

May  not  borrow  of  savings  bank 65  29 

State  Banking  Department 122  40 

Transactions  with  banks 35  20 

Overdrafts  by  employees  prohibited 39  22 

Partnership    18  15 

Penalties    144  54 

Penalty  for  failure  to  report 138  51 

Private   banks 13  12 

Publication  of  financial  condition  of  banks 132  45 

Public  administrator,  deposits  in  trust  companies  by 92  34 

Deposits  in  savings  banks 63  28 

Information  for  17-18  14-15 

Purchase  of  banks    31  19 

Of  bonds   36  21 

Real  estate  loans  by  savings  banks 67  29 

Loans  on   47  23 

Mortgages  and  contracts 35  20 

Receipt  for  county  or  municipal  deposits 3  61 

Record  of  county  or  municipal  deposits 4  62 

Report  of  superintendent  to  Governor 140  52 

Reports  of  examination  by  directors 139  51 

Penalty   for   withholding 138  51 

Publication  of    132  45 

Reports  to  superintendent — dates  of 131  45 

Reserve — lawful  money 20  15 

Of  savings  banks   68  30 

Relation  to  deposits 20  15 

Safe  deposit  department 30  19 

Sale  of  banks 31  19 

Savings  bank — use  of  words 12  12 


INDEX 189 

BANK    ACT    OF    CALIFORNIA— Con^mueJ 

Section  Page 

Savings  banks — bonds  legal  for  investment  by 6i  25 

Not  legal  for  investment  of 61  27 

Capital  stock 60  24 

"Creation  of  debt"  defined 4  9 

Deposits  with  other  banks 68  30 

How  they  may  borrow 62  27 

Limitations  of  deposits  with  other  banks 68  30 

Limitations  of  investment  in  bonds 67  29 

Loans  by   67  29 

Loans  may  not  be  made  to  directors,  etc 65  29 

Savings  banks — loans  on  real  estate  by 67  30 

Only,  can  receive  savings  deposits 49  23 

Reserve   68  30 

Stock  of  other  banks  used  as  collateral  with 67  30 

Withdrawal  of  deposits 64  28 

May  not  invest  in  mining  stock 67  30 

May  take  state,  county  and  municipal  deposits 62  28 

Property  which  may  be  purchased,  held  or  conveyed  by 61  25 

School  moneys 2  58 

Security  for  county  or  municipal  deposits I  60 

For  state  deposits 3  58 

Special  deputy  superintendent 138  51 

State  bank  department — certificate  from  superintendent  necessary..  127  42 

Chief  deputy  121  40 

Dates  for  reports  to 131  45 

Employees 121  39 

Examiners   125  42 

Funds    123  40 

Investigations  of  applications 128  43 

Location  of  offices 122  40 

Neglect  to  report  unsound  condition 126  42 

Reports  of  departmental  banks 129  43 

Reports  from  banks,  character  required 130  43 

State  deposits 57 

In  savings  banks 62  28 

State  treasurer  not  responsible  for  deposits  with  state  depositaries. . .  6  59 

Treasurer's  annual  statement  to  state  depositaries 4  59 

Stockholders — information   for 17  14 

Stockholders'  liability  cannot  be  waived 40  22 

Stockholders'  transactions  with  bank 35  20 

Stocks — bank,  used  as  collateral  with  savings  banks 67  30 

Investment  in,  prohibited 37  21 


190  N.    W.    HALSEY    &   CO. 


BANK   ACT    OF    CALIFORNIA— Continued 

Section  Page 

Superintendent — information  in  office  of 141  S3 

Neglect  of  duty  by I43  54 

Of  banks    120  39 

To  take  charge  of  unsound  banks 136  46 

Superintendent's  report  to  Governor 140  52 

Surplus — portion  of  net  profits  set  aside  for 21  16 

Surviving  relatives — payment  of  deposits  to 16  13 

Survivor  may  collect  joint  deposit 16  13 

Transactions — prior  to  passage  of  act 145  55 

Trust    companies — definition    of 6  10 

Trust  companies  only,  can  use  word  "trust" 104  37 

Trust  company — affidavit  of  directors 100  36 

Allowed  to  draw  interest  on  bonds  deposited  with  state  treasurer  98  36 

Amount  of  deposit  required  of 98  36 

Bonds  deposited  with  state  by 96  35 

Capital  required 90  33 

Confidential  relations  with  clients 103  37 

Departmental  business    106  38 

Deposits  by  authority  of  court 91  33 

Deposits  by  order  of  court  in 93  34 

Deposits  by  public  administrator  with 92  34 

Fees  of  counsel  and  appraisers 99  36 

Legal   investments   for 105  38 

May  mortgage  property 97  35 

Responsibility  of,  for  investments 94  34 

Retiring  from  business 102  37 

Shall  furnish  list  of  trusts 101  37 

Shall  pay  interest  on  moneys  held  as  trustee 95  35 

Use  of  words    12  12 

Trustees — deposits  by 51  24 

Trust  funds  32  20 

"Trust"— use  of  word  limited 104  37 

Underwriting  of  bonds 36  21 

Unlocated  depositors  15  13 

Unsafe  banks 136  46 

Unsafe  condition  of  banks — failure  to  report 143  54 

Violation  of  articles  of  incorporation 134  46 

Public  deposit  laws 11  63 

Voluntary  liquidations    I37  50 


INDEX  191 

State  Deposit  Act 

Section  Page 

Act  of  1905  repealed 

Additional  security  may  be  required 3  58 

Bonds  which  may  be  used  as  security  for  funds  on  deposit 3  58 

Certificate  of  deposit  taken  by  state  treasurer  counted  as  cash 7  59 

Deposit  of  state  moneys  in  banks i  57 

Deposits  subject  to  call i  57 

Expense  of  transporting  moneys  to  and  from  depositary  banks i  57 

Indemnity  bonds  may  be  required S  59 

Interest — rate  on  deposits i  57 

Interest — when  payable 2  58 

Limitation  of  deposits i  57 

Provisions  of  contract 4  59 

School  moneys  on  deposit 2  58 

Security   for   deposits i  57 

Treasurer's  annual  statement  to  bank 4  59 

Treasurer  not  responsible  for  deposits 6  59 

Warrants  may  be  paid  by  certificates  of  deposit 7  60 

Value  of  bonds  deposited  as  security 3  58 


County  and  Municipal  Deposit  Act 

Section  Page 

Amount  that  may  be  deposited 5  62 

Bonds  required  as  security I  60 

Counties  or  municipalities  may  buy  bonds 12  64 

Deposit  of  public  moneys,  other  than  state,  in  banks i  60 

Deposits  subject  to  call 7  62 

Expense  of  transportation  of  moneys  to  and  from  depositary  banks..  10  63 

Interest  payable  quarterly 2  61 

Minimum  rate  two  per  centum 2  61 

On  failure  of  bank  to  repay,  security  to  be  sold 8  62 

Public  officials  not  responsible  for  deposits 9  63 

Rate  of  interest  to  be  fixed,  when 2  61 

Receipt  for  deposit 3  61 

Receipts  to  be  counted  as  cash 6  62 

Record  of  deposits 4  62 

Repeal  of  acts  in  conflict 13  64 

Value  of  bonds  deposited  as  security. i  61 

Violation  of  deposit  laws ll  63 


192  N.    W.    HALSEY    &   CO. 


National  Bank  Act 


Section  Page 

Act — national  bank i  65 

Additional  Circulation  Act ibr 

Amendments  to  articles  of  association 42  jj 

Appointment — term  and  salary  of  Comptroller 3  65 

Articles  of  association 13  68 

Assessment  for  impairment  of  capital 1 15  104 

Assessment — provision  for  enforcement  of 116  104 

Associations  must  not  hold  their  own  capital  stock in  103 

Bank  circulation  Chapter  III  79 

Bank  circulation — penalty  for  imitating  for  advertising  purposes 167  125 

Pledging    166  124 

preparation   of 59  84 

Bank — closed  circulation  of 71  90 

Bank  may  enjoin  further  liquidation  proceedings 145  114 

Bank — proceedings  to  liquidate  must  be  brought 146  115 

Banks — liquidating  circulation  of 89  96 

National,  failed 160  120 

To  take  circulation  at  par yj  92 

Whose  existence  has  expired 142  1 13 

Bonds — annual  examination  of 56  81 

Deposit  of  United  States 24  72 

Examination    of 55  81 

Exchange   of 51  80 

Forfeited  if  circulation  is  dishonored 144  114 

General  provisions  respecting 57  82 

Held  by  treasurer 52  80 

Notice  of  transfer  of 54  81 

Of  liquidating  banks 141  1 12 

Record  of  transfer  of 53  81 

Relation  of  bonds  deposited  to  capital 50  80 

Security  for  circulation 49  79 

Sold  at  private  sale 151  116 

Sold  at  public  auction 149  115 

United  States,  defined 48  79 

Capital — assessment  for  impairment  of 115  104 

Relations  of,  to  bonds  deposited 50  80 

Capital  stock — associations  must  not  hold  their  own in  103 

Amount  required 17  70 

Enforcing  payment  of 20  71 

Increase   of 43  77 

Payment  of    19  70 

Reduction  of 45  78 


INDEX  193 


NATIONAL    BANK   ACT— Continued 

Capital  Stock — Continued                                                                            Section  Page 

Restoration    of 21  71 

Shares  of 18  70 

When  increase  becomes  valid 24  72 

Certificate  of  authority 25  72 

Organization    15  69 

Publication   of 26  yz 

Officers  and  directors 23  72 

Certification  of  checks — false 177  129 

False,  penalty  for 178  129 

Certified  copies  of  organization  certificate  as  evidence 183  131 

Charter — forfeiture  of 157  118 

Circuit  courts  may  enjoin  Comptroller 180  130 

Circulation — amount    obtainable 58  83 

Banks    Chapter    III  79 

Of  extended   banks 69  89 

For  what  receivable 63  85 

Improper  use  of  bank 113  103 

Of  expired  banks,  penalty  for  issue  of 176  128 

Of  gold  banks 64  86 

Shall  bear  charter  number  of  bank 60  85 

Tax  on Chapter   IV  92 

Clearing  house  certificates  counted  as  reserve. 

Clerks  in  Comptroller's  office 7  66 

Closed  bank — circulation  of 71  90 

Comptroller  of  the  Currency 2  65 

Condition — reports  of 1 19  105 

Verification  of,  report  of  condition 120  106 

Consent  of  two-thirds  necessary  for  extension 132  no 

Contributions — corporation,  to  political  parties  prohibited 160 

Converted  bank  may  retain  branches 39  76 

Corporate  existence — extension  of •• Chapter  VI  109 

Powers   16  69 

Counterfeit  circulation — penalty  for 169  125 

Penalty  for  dealing  in I75  128 

Penalty  for  improper 165  124 

Penalty  for  passing 172  127 

Creditor's  bill  against  shareholders 164  123 

Creditors — illegal  preference  of 163  123 

Crimes  Chapter  VIII  124 

Currency  Act,  March  14,   1900 151 

Currency  bureau    Chapter    I  65 

Delivering  circulation — penalty  for  improper 165  124 


194  N.    W.    HALSEY    &   CO. 


NATIONAL    BANK   ACT— Continued 

Section  Page 

Deposit  and  withdrawal  of  public  moneys  in  government  depositaries.  226  147 

By  certain  postmasters  in,  provision  for  government  depositaries.  227  147 

Not  required  for  consolidation 140  112 

Of  lawful  money  for  redemption  of  outstanding  circulation 139  112 

Of  United  States  bonds 24  72 

Depositaries — government    Chapter    XI  146 

Deputy  comptroller 5  66 

Designation  and  duties  of  government  depositaries 225  146 

Directors  in  Oklahoma — qualifications  of 29  73 

Number  and  election  of 27  73 

Oaths  of 31  74 

Qualifications  of 28  73 

Vacancies  in  board  of 33  75 

Dissenting  shareholders  may  withdraw 135  no 

Dividends  by  national  banks 109  102 

Reports  of 121  106 

Unearned,  prohibited  1 14  103 

Earnings — reports  of 121  106 

Election — failure  to  hold  annual 32  74 

Qualifications  of  voters  at 30  74 

Enforcing  tax  on  circulation 83  94 

Evidence   182  131 

Examination  in  District  of  Columbia 128  108 

Examiners   125  107 

Compensation  of 127  108 

Qualification  for 126  107 

Existence — corporate Chapter  VI  109 

Extended  banks — circulation   of 69  8g 

Extension  of  corporate  existence Chapter  VI  109 

Failure  to  make  semi-annual  return  of  taxable  circulation 88  96 

First  lien  for  redeeming  circulation 150  116 

Fraudulent  notes  to  be  marked 79  92 

Gold  bank — conversion  of 36  75 

Organization  of 35  75 

Circulation  of     64  86 

Reserve  requirements  for 102  100 

Gold  certificates  counted  as  reserve loi  99 

Government  depositaries    Chapter   XI  146 

Impairment  of  capital — assessment  for 115  104 

Impressions  of  tools,  penalty  for  having 174  128 

Penalty  for  taking  unauthorized 173  127 

Indian  Territory — ^jurisdiction  in 185  131 


INDEX 195 

NATIONAL    BANK   ACT— Continued 

Section  Page 

Insolvent  bank — distribution  of  assets  of i55  nS 

Notes  to  creditors  of IS4  "7 

Taxes  unremitted  i6o  120 

Interest  by  Comptroller  in  national  banks  prohibited 6  66 

Interest — penalty   for  unlawful 108  102 

Which  may  be  charged  by  national  banks 107  101 

Issue  of  other  notes  prohibited 78  92 

Jurisdiction Chapter    VIII  124 

Lawful  money 231  150 

Laws  apply  to  all  national  banks 92  97 

Legal  tender  and  lawful  money 231  150 

Liabilities — exception  for  trustees,  etc 41  77 

Liability  of  directors 158  118 

Personal,  of  shareholders 40  76 

Restriction   on   banks H2  103 

Liquidating  banks,  circulation  of 70  90 

Liquidation Chapter    VII  lii 

Location — change  of 46  78 

Material  for  circulation — penalty  for  illegal  possession  or  use  of 171  126 

Money  order  funds — penalty  for  misapplication  of 228  148 

Mutilating  circulation — penalty  for 168  125 

National  bank  act i  65 

National  bank  cases — jurisdiction  of 181  130 

National  banks — powers  and  organization  of Chapter  II  68 

Regulation    of Chapter    V  97 

"National,"  use  of — in  titles 130  109 

Notice  to  present  circulation  for  redemption 148  115 

Uncurrent — prohibition  against 117  105 

United  States,  redemption  in 74  91 

Notice  of  voluntary  liquidation 138  112 

"Obligations  of  the  United  States"  defined 170  126 

Office  malfeasance — penalty  for 179  130 

Offices,  vaults,   etc..   Comptroller's 9  66 

Organization  and  power  of  national  banks Chapter  II  68 

Certificate  14  68 

Proceedings,  examination  of 22  71 

Organized  under  the  act  of  February  25,  1863 — status  of 47  79 

Penalty  for  failure  to  report 122  106 

For  unlawful  interest  charges 108  102 

Place  of  business 93  97 

Plates  and  dies — control  of 61  85 

Examination  of 62  85 

Pledging  United  States  notes — penalty  for 166  124 


196  N.    W.    HALSEY    &   CO. 


NATIONAL    BANK    ACT— Continued 

Section  Page 

Powers  and  organization  of  national  banks Chapter  II  68 

Powers — corporate   i6  69 

President  shall  be  a  director 34  75 

Private  sale — bonds  sold  at 151  1 16 

Proceedings  in  default  of  tax  on  circulation 82  94 

Protest  of  bank  circulation 143  113 

Public  auction — bonds   sold   at 149  115 

Provisions  for  redeeming  circulation 66  87 

Qualifications  of  Comptroller 4  65 

Real  estate — dealings  of  national  banks  in 106  loi 

Receiver — appointment  and  duties 152  1 16 

When  may  be  appointed 153  117 

When  he  may  purchase  property 159  119 

Receivership Chapter  VII  1 1 1 

Expenses  of — how  paid 156  118 

Redeemed  notes  to  be  cancelled 7Z  90 

Redemption    account — disposition    of 75  91 

Fund   counted    as    reserve 98  98 

Of  incomplete  circulation 76  91 

Of  circulation  in  United  States  notes 74  91 

Of  United  States  note  certificates 100  99 

Refunding  excess  tax  on  circulation 84  94 

Regulation  for  redemption  records T^  9° 

Of  the  banking  business Chapter  V  97 

Report — annual,    of    Comptroller 10  67 

Reports  of  condition 119  105 

Of  condition,  verification  of 120  106 

Of  dividends  and  earnings 121  106 

Of  other  banks 123  106 

Penalty  for  failure  to 122  106 

Reserve — agents'  balances  counted  as 96  98 

Cities   94  97 

Clearing  house  certificates  counted  as 97  98 

Deposit  in  central  reserve  city 103  100 

Cities,  additional 104  100 

Not  maintained  95  98 

Redemption  fund  counted  as 98  98 

Requirements 94  97 

Requirements  for  gold  banks 102  100 

United  States  gold  certificates  counted  as loi  99 

United  States  note  certificates  counted  as 99  98 


INDEX  197 

NATIONAL    BANK   ACT— Continued 

Section  Page 

Restrictions  on  liability 112  103 

On  loans no  102 

Savings  banks  in  the  District  of  Columbia Chapter  X  144 

Seal  of  Comptroller's  office 8  66 

Semi-annual  return  of  circulation 81  93 

Return  of  taxable  circulation 87  95 

Shareholders'  agent — appointment  and  qualifications   of 161  120 

Agents,   duties   of 162  122 

Dissenting,  may  withdraw I3S  i  ^0 

Liability  40  76 

List  of 118  IDS 

Special  examination  necessary  for  extension 133  no 

State  banks — conversion  of 37  75 

Capital  of   38  76 

State  taxation  of  national  banks 124  107 

Status  not  changed  by  extension 134  1 10 

Suspension  of  business  after  default 147  115 

Suits  against  United  States  officers  or  agents 184  131 

Surplus  of  national  banks 109  102 

Tax  on  authorized  circulation 86  95 

Circulation Chapter  IV  92 

Circulation  of  converted  banks 89  96 

Circulation  provisions  restricted 90  96 

Taxation  of  national  banks  by  state 124  107 

Of  notes,  etc 91  96 

Title — change    of    46  78 

Trust  companies  in  the  District  of  Columbia Chapter  IX  132 

Unauthorized  deposit  of  public  moneys — penalty  for 229  149 

Receipt  or  use  of  public  money 229  149 

United  States  note  certificates  counted  as  reserve 99  98 

Use  of  "National"  in  titles ^ 130  109 

Violation  of  banking  law Chapter  VIII  124 

Visitorial  power — limitations  of 129  109 

Vote  required  for  liquidation I37  1 1 1 

When  circulation  is  exempt  from  taxation 85  94 

Withdrawing  circulation  67  88 

Circulation,  general  provisions  for 68  88 

Worn-out  or  mutilated  circulation 65  86 


198  N.    W.    HALSEY    &   CO. 


CODE   OF   THE    DISTRICT   OF   COLUMBIA 

Section  Page 

Amendment — provision    for 220  143 

By-laws    210  141 

Capital — increase  of 215  142 

Capital   stock — money   payments   of — required 207  140 

Provisions  relating  to 199  137 

Charter    188  133 

Filing    of 190  133 

Competent  to  act  as  trust,  etc 193  135 

Corporate  existence    198  137 

Directors'  liability  for  payment  of  unearned  dividends 211  141 

Liability  may  be  avoided 212  141 

Number  and  election  of 208  140 

Responsibility  of,  for  excess  liabilities 213  141 

District  court — all  similar,  subject  to  this  act 219  143 

Enforcement  of  subscriptions  to 200  138 

Evidence — certified  copy  of  incorporation  certificate  competent 216  142 

Jurisdiction,  district  supreme  court  has 218  142 

Larceny    204  139 

Liability  for  failure  to  report 203  139 

No  bond  or  other  security  required 217  142 

Notice  of  intention  to  apply  for  charter 189  133 

Officers — appointment    of 209  140 

Organization  certificate   • 187  132 

Perjury    204  139 

Powers   192  134 

Privileges  extended  to  existing  corporations 196  136 

Provisions    for    organization 186  132 

Qualifications  as  trustee 194  136 

Real  estate — dealings  in 197  137 

Report — annual   of   Comptroller 201  138 

Security  for  faithful  performance  of  trust 195  136 

Stock — interest  of 205  139 

Stockholders'  liability    206  140 

Supervision — under   Comptroller    191  134 

Tax  on  gross  earnings 202  138 

Trust  companies,  etc. — provisions  for  charter 189  133 

Trustee  not  liable  on  stock  assessment 214  141 

SAVINGS    BANKS,    ETC.— DISTRICT   OF   COLUMBIA 

Savings  banks   in — formation  of 221  144 

Reports  to  Comptroller 222  144 

Examination  of,  by  Comptroller 223  145 

Act  of  June  25,  1906,  relative  to 224  145 


INDEX 


199 


Index  to  Sections  of  Revised  Statutes  Included 
in  the  National  Bank  Act  as  Amended 


Section 

Paragraph 

Section 

Paragraph 

Section 

Paragraph 

Section 

Paragraph 

324 

2 

5136 

16 

5182 

63 

6220 

137 

325 

3 

5137 

106 

6183 

78 

6221 

138 

326 

4 

6138 

17 

5184 

65 

6222 

139 

327 

5 

5139 

18,42 

5185 

35,64 

6223 

140 

328 

7 

5140 

19 

5186 

102 

6224 

141 

329 

6 

5141 

20,21 

5187 

165 

5226 

70 

330 

8 

5142 

43,44 

5188 

167 

5226 

143 

331 

9 

6143 

45 

6189 

168 

5227 

144 

332 

128 

5144 

30 

6190 

93 

5228 

147 

333 

10 

5145 

27 

5191 

94,95 

5229 

148 

380 

184 

5146 

28 

6192 

96 

5230 

149, 150 

605 

221 

5147 

31 

5193 

99 

6231 

151 

629 

180 

6148 

33 

5194 

100 

6232 

72 

713 

222,224 

5149 

32 

5196 

103 

6233 

73 

714 

222,224 

5150 

34 

6196 

77 

5234 

152 

736 

146 

5151 

40 

6197 

107 

5235 

164 

884 

182 

5152 

41 

6198 

108 

5236 

155 

885 

183 

5153 

226 

6199 

109 

6237 

146 

3410 

38 

5154 

37 

6200 

110 

6238 

166 

3411 

85 

5156 

39 

6201 

111 

5239 

167,158 

3414 

87 

5156 

47 

5202 

112 

5240 

125,126, 

3415 

88 

5157 

92 

6203 

113 

127 

3416 

89 

6158 

48 

5204 

114 

6241 

129 

3417 

90 

6159 

24,49 

6205 

115 

5242 

163 

3585 

231 

5160 

60 

5206 

117 

5243 

130 

3586 

231 

5161 

61 

5207 

166 

6413 

170 

3587 

231 

5162 

52 

5208 

177 

6416 

169 

3588 

231 

5163 

63 

5209 

179 

5430 

171 

3589 

231 

5164 

54 

5210 

118 

5431 

172 

3590 

231 

5165 

56 

5211 

119 

5432 

173 

3620 

226 

5166 

66 

5212 

121 

5433 

174 

3701 

91 

5167 

67 

5213 

122 

6434 

175 

3811 

11 

5168 

22,23 

5214 

80 

6437 

176 

3847 

227 

5169 

25 

5215 

81 

6488 

229 

4046 

228 

5170 

26 

5216 

82 

6497 

230 

5133 

13 

6172 

69 

5217 

83 

5134 

14 

5173 

61 

6218 

84 

5135 

15 

6174 

62 

5219 

124 

200  N.    W.    HALSEY    <5-   CO. 


Currency   Act 


Section  Page 

Amendment  to  section  5138,  R.  S 10  156 

Bimetallism — international     14  159 

Bonds — deposit  of,  to  secure  circulating  notes 12  157 

Issued  to  maintain  reserve 2  152 

Substitution  of 12  150 

U.  S.,  exchange  of  outstanding  issues  authorized 11  156 

Certificates — gold    6  153 

Gold,  when  authority  to  issue  is  suspended 6  154 

Silver,  denominations 7  155 

Coin — subsidiary  issue  of 8  155 

Coinage  of  silver  dollars 5  153 

Deposit  of  bonds  to  secure  circulating  notes 12  157 

Division  of  issue 4  153 

Division  of  redemption 4  153 

Dollar — gold,  standard  of  value i  151 

Dollars — silver,  coinage  of,  to  retire  treasury  notes 5  153 

Gold  certificates 6  153 

When  authority  to  issue  is  suspended 6  154 

International  bimetallism 14  159 

Issues — division    of 4  153 

Legal  tender  quality  not  affected 3  152 

Notes — circulating,  additional  security  may  be  required  for 12  150 

Circulating,  denomination  of 12  150 

Circulating,  secured  by  deposit  of  bonds 12  157 

Circulating,  shall  not  exceed  paid-up  capital 12  150 

Circulating,  tax  on 13  159 

Reissued 2  152 

Treasury   2  151 

United  States,  amount  outstanding  fixed  by  law 6  154 

Redemption   of  treasury  notes 2  151 

Of  United  States  notes 2  151 

Reserve — maintenance  of 2  151 

In  trust  funds 4  153 

Redemption — division    of 4  153 

Silver  certificates — denomination   7  155 

Dollars,  coinage  of 5  153 

Standard  of  value — gold   dollar i  151 

Subsidiary  coin — issue  of 8  155 

Tax  on  circulating  notes 13  159 


INDEX  201 


Additional  Circulation  Act 

Section  Page 

Additional  circulation  act,  appropriations  to  carry  out i6  172 

Date  of  expiration  of  act 20  173 

Date    of   act 20  173 

Additional  circulation — application  for,  by  banks i  162 

Application  for,  by  a  national  currency  association 3  165 

Deposit  of  securities  for i  162 

Deposit  of  securities  for,"  by  national  currency  association 3  165 

Distribution  geographically 7  168 

Distribution  of  notes 10  171 

Information  regarding  securities  pledged  for 8  168 

Legal  title  of  bonds  as  security  for,  transferred 4  166 

Limit  of  indebtedness  of  municipality  in  proportion  to  balance 

of  taxable  property 3  166 

Limit  of  issue S  167 

Limited  to  ninety  per  centum  of  cash  value  of  municipals 1-3  163-165 

Limited  to  seventy-five  per  centum  of  cash  value  of  commercial 

securities  i  163 

Not   to   exceed   thirty   per   centum    of   capital   when   based   on 

commercial  paper i  163 

Redemption  fund  must  cover 6  167 

Reports,  monthly 9  169 

Securities  available  for i  162 

Status    of 5  167 

Tax  on  9  169 

Value  of  securities  pledged  for 8  168 

Withdrawal    of 10  170 

Circulation — printing  of  notes 11  171 

Redemption  of  notes 12  171 

Tax  on 9  168 

Withdrawal  of  notes 10  170 

163 
161 
162 


Commercial  paper — definition  of.. 
National   Currency   Association.... 
A  bank  may  belong  to  but  one. 


Application  by,  for  additional  circulation 3       165 

By-Laws  of  

Capital  of  

Certificates  of 


162 
161 
161 

Deposit  of  securities  for  additional  circulation 3       165 

162 
164 


Dissolution  of  members  of 

Failure  of  member  to  deposit  additional  securities. 


Failure  of  member  to  make  good  redemption  fund 2       164 


202  N.    W.    HALSEY    &   CO. 


ADDITIONAL    CIRCULATION    ACT— Con/mueJ 

National   Currency  Association — Continued                                          Section  Page 

Substitution  of  securities i  164 

Liability  of  member  of i  163 

Management  of i  162 

May  be  sued i  161 

May  require  additional  securities i  164 

Members  may  be  sued  in  circuit  court i  164 

Membership    i  161 

Name    of i  161 

Number  of  banks  required  to  form . ; i  161 

Officers   of i  162 

Purposes  of i  162 

Place  of  business i  161 

Powers  of  board i  162 

Receipt  given  for  bonds  deposited 4  166 

Sale  of  securities  deposited  by  members 2  165 

Under  authority  of  Secretary  of  Treasury 13  172 

National  Monetary  Commission,  creation  of 17  172 

Expiration    of 19  173 

To    report 18  173 

Public  deposits  14  172 

Interest   on 15  172 

New  York  Savings  Bank  Law 

Bonds — limitation  of  holdings  of  railroad  bonds 6i      181 

Bonds  legal  for  investment. 

Of  United  States 

Of  District  of  Columbia 

Of  State  of  New  York 

Of  counties  of  New  York 

Of  municipalities  of  New  York 

Of  school  districts  of  New  York 

On  real  estate  in  New  York 

Of  various  states,  provided 

Of  municipalities  outside  of  New  York,  provided 

Of  railroad  corporations  of  New  York,  provided 

Of  railroad  corporations  of  the  United  States,  provided 

Of  railroad  corporations  owning  less  than  500  miles  of  road,  pro- 
vided     

Of  railroad  corporations,  guaranteed,  provided 

Of  railroad  corporations,  underlying,  provided ; . . 

Street  railroad,  not  railroad  bonds 

Mortgages  on  real  estate 


Of  Tv. 


I 

175 

I 

17s 

2 

175 

4 

176 

4 

176 

4 

176 

6 

177 

3 

175 

5 

176 

6a 

177 

6e 

178 

6f 

179 

6g 

180 

6i 

180 

6i 

182 

6 

177 

14  DAY  USE 

RETURN  TO  DESK  FROM  WHICH  BORROWED 

LOAN  DEPT. 

RENEWALS  ONLY— TEL.  NO.  642-3405 

This  book  is  due  on  the  last  date  stamped  below,  or 

on  the  date  to  which  renewed. 

Renewed  books  are  subject  to  immediate  recaU. 


ifiauo-f£fr 


■i /I -HAM  90 


LD21A-60m-3,'70 
(N5382sl0)476-A-32 


General  Library     _ 
University  of  California 
Berkeley 


181444 

/303 


'?w/> 


